Maine Votes to End Fuel Tax Indexing

Maine’s legislature has approved a two-year, $637 million transportation funding bill that would end annual fuel tax increases tied to inflation beginning next year.

The end of indexing would deprive the state of more than $5 million per year, Gov. Paul LePage (R) estimated in his budget request for fiscal 2012 and 2013, which asked for the end of fuel tax indexing.

The state’s trucking association backed the push to stop the indexing.

“It’s not that we don’t believe the infrastructure needs appropriate support,” said Brian Parke, president of the Maine Motor Truck Association. “We didn’t like the fact that it was on automatic pilot.”

Under the indexing model, taxes on a variety of fuels including diesel and gasoline increase each year by a rate calculated from the consumer price index, the state’s revenue services department said.

The tax will increase to 31.2 cents per gallon July 1, from the current 30.7 cents, the department said on its website.