Georgia gas tax suspension set to end, prices expected to rise
Gas prices are displayed on a gas pump at an Exxon gas station in Washington, DC, on May 24, 2022. (Photo by STEFANI REYNOLDS/AFP via Getty Images)
ATLANTA - After months of extensions, Georgia's suspension of the state's motor fuel tax is set to expire on Tuesday.
Kemp had broad bipartisan support in March when he signed a law suspending the fuel tax through May 31 amid soaring prices at gas pumps and grocery stores. Since then he has ordered seven separate extensions of the tax break, which state law allows as long as lawmakers ratify the action when they reconvene in 2023.
After signing an extension in December that lasted until Tuesday, Kemp suggested during a state Capitol news conference that he won’t extend it further.
After 10 months of tax relief at the gas pump, Kemp said, "we’re going to transition away from that temporary program." He added: "We can’t continue to pay what we’re doing on the gas tax suspension."
Georgia’s gasoline price normally includes a federal tax of 18.4 cents per gallon and a state tax of 29.1 cents per gallon. A number of counties and the city of Atlanta also charge taxes. Federal taxes on diesel fuel are 24.4 cents per gallon, while Georgia’s tax on diesel is 32.6 cents per gallon.
Instead, Kemp said his focus will turn to seeking legislative approval of another round of income tax rebates and a property tax break — a pair of campaign promises expected to cost another $1 billion apiece.
The governor will seek a second round of income tax rebates like the $1.1 billion in payments issued this year. The rebates gave dual-earner households $500, single adults with dependents $375 and single adults $250.
Kemp also hopes to revive a property tax break that was allowed to lapse in 2009 amid a state budget crisis caused by the Great Recession. Kemp has proposed spending another $1 billion to save what he says will be about $500 a year for taxpayers with homestead exemptions.
With the gas tax expected to go back into effect, prices at the pump could jump this week.
According to AAA, the average price for a gallon of regular unleaded gas in Georgia currently is about $2.81 - much lower than the national average of $3.27.
The Associated Press contributed to this report.