Maryland Senate Approves Fuel-Tax Increase
Maryland’s Senate passed a bill to increase the state’s taxes on diesel and gasoline and tie them to inflation to pay for transportation projects, sending the measure to Gov. Martin O’Malley (D) for his expected signature.
The bill, which passed Friday, would increase the state’s fuel taxes on July 1 of every year based on the Consumer Price Index, a primary gauge of inflation.
The new law would add a new sales tax on both fuels that would be 3% of the price of the lowest grade of the fuel, minus other fuel taxes. The House of Delegates passed the bill a week earlier.
Maryland’s state’s diesel tax is currently 24.25 cents per gallon, and the gasoline tax is 23.5 cents per gallon.
The Maryland Motor Truck Association warned that the measure would raise shipping costs and make the state’s fuel taxes the highest in the country.
“MMTA knows that Maryland’s aging and congested transportation system must be financially supported,” MMTA President Louis Campion said in a statement. “However, we are concerned that this legislation creates two new inflationary-sensitive measures.”
O’Malley, who proposed the measure to the legislature last month, applauded its passage, which he said “will support more than 57,000 jobs, ease traffic congestion, and build a 21st century transportation network.”
The measure is similar to a New Hampshire plan to phase in a 12-cent gas and diesel tax increase that the New Hampshire House approved last week, the Associated Press reported.
It follows neighboring Virginia’s transportation bill, signed last month by Gov. Bob McDonnell (R), which alters fuel taxes with a new wholesale tax structure, while also scrapping plans to toll Interstate 95.
