Pennsylvania lawmaker wants to 'abolish' state's fuel tax rate increase

By Keith Goble, Land Line state legislative editor | Thursday, July 21, 2016

If a Pennsylvania state lawmaker gets his way, truckers and other drivers fueling in the state would get a break at the pump after the first of the year.

The state now collects 51.4 cents on each gallon of gas sold in the commonwealth. The diesel tax rate is set at 65.1 cents. Each rate is the highest in the nation.

On Jan. 1, 2017, an increase of as much as 10 cents is anticipated. The rate increases are set by a 2013 state law that removed the state’s flat tax on fuel and instead uncapped the state’s oil company franchise tax – the tax on wholesale fuel purchases.

Rep. Joseph Petrarca, D-Westmoreland, says that although the tax is applied to wholesalers, it has been passed down to drivers at the pump.

As a result, the gas tax has increased nearly 20 cents per gallon from 32.3 cents in 2013. Over the same time the diesel rate has increased about 26 cents from 39.2 cents.

Petrarca has introduced a bill to “abolish” planned increases in the state’s fuel tax rates. Specifically, HB2248 would cancel the statutorily required January increase, keeping the wholesale price level, effectively preventing future tax increases based on the formula.

“Pennsylvania already has the highest (fuel) tax in the nation,” Petrarca said in prepared remarks. “It’s time to stop it from getting higher.”

He points out the average fuel tax rate for states is 26.5 cents. The next closest state to Pennsylvania is Washington at 49.4 cents per gallon.

The Keystone State’s tax rates were increased three years ago as part of a $2.4 billion transportation spending plan that includes raising various taxes and fees.

Act 89 of 2013 also increased vehicle fees for trucks with a gross weight of 80,000 pounds. In the first year, the fee increased from $1,687.50 to $1,827. Increases of $189 are implemented during each of the next three years to top out at $2,244 by fiscal year 2017-2018.

Once fully implemented, fees will rise with inflation.

Petrarca’s bill to do away with fuel tax rate increases is in the House Transportation Committee.

To view other legislative activities of interest for Pennsylvania, click here.

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