Maryland governor signs gas tax suspension bill into effect
Maryland Gov. Larry Hogan signs a bill into law to suspend the state’s gas tax for 30 days during a bill signing ceremony in Annapolis, Md., on Friday, March 18, 2022. Senate President Bill Ferguson is seated left, and House Speaker Adrienne Jones is seated right. State lawmakers are standing behind them. (AP Photo/Brian Witte)
ANNAPOLIS, Md. (AP) — Maryland Gov. Larry Hogan immediately put a 30-day suspension of the state’s gas tax into effect Friday in response to skyrocketing prices.
Hogan, a Republican, described it as a bipartisan effort to provide some relief to Marylanders because of skyrocketing gas prices that could go up even higher after the country cut off Russian oil imports in response to the war in Ukraine.
“This of course is not going to be a cure-all, and market instability will continue to lead to fluctuations in prices, but we will continue to use every tool at our disposal to provide immediate relief for Marylanders,” Hogan said at a bill-signing ceremony with Democrats and Republicans.
The law was enacted as governors and state lawmakers across the nation have been calling to suspend gas taxes. Georgia lawmakers approved a suspension of the state’s fuel tax through May, and Gov. Brian Kemp signed the bill Friday. Florida lawmakers have approved a plan to temporarily suspend the gas tax for one month, October.
The Maryland law applies to the state’s 36-cents a gallon tax for gasoline. A driver of a vehicle with a 12 gallon tank will save about $4.32 a fill-up. It also applies to the state’s tax on diesel fuel, which is nearly 37 cents.
Hogan has submitted a supplemental budget to fund the gas tax suspension, which is expected to cost nearly $100 million.
Although the measure took effect as soon as Hogan signed the bill, it could take some time for consumers to see relief, because gas stations now are selling fuel they were taxed on at the wholesale level.
The average price of gas in Maryland was about $4.16 on Friday.
The gas tax suspension comes as Maryland has an extraordinary budget surplus. Revenues have been much higher than previously estimated because of enormous federal pandemic aid. Comptroller Peter Franchot announced last week that the surplus is about $7.5 billion over two years.
With just over three weeks to go in Maryland’s legislative session, other tax relief measures also are being considered.
Earlier Friday, the Maryland Senate passed the state’s $58.5 billion budget for the next fiscal year. It includes $350 million for tax relief that remains to be finalized.
Hogan said his administration is having “productive discussions to advance long-term permanent tax relief for Maryland families, small businesses and retirees.”
“It sets aside $350 million for tax relief so that we can assist our seniors and working families for their basic necessities,” Senate President Bill Ferguson, a Baltimore Democrat, said at the bill signing.
The budget includes about $3.3 billion in cash reserves. It also includes the intention of setting aside $800 million to pay future costs for Maryland’s sweeping education reform law, known as the Blueprint for Maryland’s Future.
It also includes $832 million for cost-of-living adjustments, salary increases and bonuses for state employees to attract and retain them in a competitive labor market.
Another $240 million is targeted to support health care workers and businesses that continue to be heavily affected by the pandemic.
The budget legislation now goes to the House of Delegates.
