Michigan Senate approves proposal that would pause taxes on gas this summer
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Michigan Republican and Democratic senators are pushing ahead with a series of new bills that would create a temporary summer tax pause when it comes to buying fuel.
The bills pause collections on the 6% sales and use taxes on gas purchases and the 27-cent-per-gallon excise gas tax. The pause would run from June 15 to Sept. 15.
The measures received sweeping, bipartisan support in the Senate on Thursday, potentially indicating the GOP-controlled chamber found a proposal that Gov. Gretchen Whitmer may support.
"These bills provide Michiganders facing record high gas prices — that are trying to make it to school, make it to work — with immediate relief at the fuel pump," said state Sen. Aric Nesbitt, R-Lawton.
Whitmer previously suggested temporarily suspending sales tax collections on gas, so there may be room for a legislative compromise on the plan. A spokesman said the governor is "encouraged" by the Senate package.
"We will monitor this legislation as it advances. The governor looks forward to working with the Legislature on a broader bipartisan agreement that puts Michigan first but cutting taxes and providing real relief right now for our seniors and working families," said spokesman Bobby Leddy.
The package quickly advanced earlier in the day through the Senate Transportation and Infrastructure Committee, where lawmakers voted in less than 12 minutes to send four bills to the Senate floor.
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"It's no secret to any of the members of the committee or members of the public that fuel has come to a nationally high level and is expected to go even higher," said Committee Chairman Sen. Tom Barrett, R-Charlotte, noting some projections indicate prices may exceed $6 per gallon over the summer.
"A lot of our economy requires the use of fuels, whether that's motorists driving themselves to and from work or other obligations they have, or for businesses that need to move goods around for sale to residents."
On the Senate floor, Barrett said the combined cuts in the bills would immediately save drivers about 50 cents per gallon.
A Senate Fiscal Agency analysis of the bill package projected it would cost the state somewhere between $760 million to $800 million in lost tax revenue this financial year.
The proposal also mirrors legislation previously championed by Senate Minority Leader Jim Ananich, D-Flint, and comes amid projections for a massive budget surplus.
"To the people of Michigan who are worried about the cost and feeling the pinch, we hear you," Ananich said.
"Inflation is high, budgets are tight. And the state has the responsibility to step in and help. That's what we're doing today."
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But a slew of Michigan education organizations continue to oppose any pause to tax collections on gas purchases, arguing the hundreds of millions potentially lost to the state may affect funding for schools. Barrett noted that the bill that pauses collecting the 27-cent tax also shifts $300 million from the state's General Fund to make up for lost revenue that would typically go to local governments.
Previously, GOP efforts to repeal or pause taxes on gas have fallen flat. Whitmer already vetoed a plan that would repeal the state gas tax, noting that Senate Republicans failed to ensure the measure would take effect immediately.
The measures now go to the House.
Contact Dave Boucher: dboucher@freepress.com or 313-938-4591. Follow him on Twitter @Dave_Boucher1.
This article originally appeared on Detroit Free Press: Michigan lawmakers push gas tax pause for this summer
