Higher gas tax not likely, Berger aide says (N&O)
Submitted by BruceSiceloff on 02/18/2011 – 11:12
Market forces will push North Carolina’s record-high gas tax even higher in July — unless political forces decide otherwise.
Democrats were in charge four years ago when drivers were unhappy about rising gas taxes, so they capped the tax for two years at 29.9 cents a gallon. That ceiling was converted to a legislative floor in 2009, and our inflation-adjusting tax has risen since then to an all-time high of 32.5 cents.
The General Assembly’s new Republican leaders seem likely to put a lid on it again.
“They have not specifically talked about this in caucus,” says Ray Martin, press secretary for Republican Sen. Phil Berger, the Senate president pro tem. “But it’s likely they’d want to look at capping any increase in the tax.”
Rising wholesale prices are pushing the tax higher. The gas tax is based on a formula: Currently, under the temporary law enacted in 2009, it is 17.5 cents plus the higher of two numbers — either 12.4 cents or 7 percent of the average wholesale price. That’s a minimum of 29.9 cents a gallon, and no maximum.
Gov. Bev Perdue’s proposed budget assumes the gas tax will increase by about a penny in the coming year. But a higher increase is possible under the 7 percent formula, which adds about a penny of tax for every 15-cent increase in the wholesale price. Retail gas prices have risen about 48 cents in the past six months, and the underlying wholesale price also has increased.
Each penny of gas tax generates about $50 million for road maintenance and construction, and other transportation spending.
Read more: http://blogs.newsobserver.com/crosstown/higher-gas-tax-not-likely-berger-aide-says#ixzz1ELNKpdG1
