(The Center Square) – A 39% rise in gasoline prices and a 51% increase in diesel fuel prices during the past year have Pennsylvania consumers “stressed and struggling” – in the words of one state lawmaker – but proposals in the Legislature to reduce or eliminate taxes that add to the cost have gained little traction.
AAA showed the average price of unleaded gasoline in Pennsylvania was $4.64 a gallon on Wednesday, up from $3.33 a year ago. The increase in diesel fuel was even more dramatic, going from $3.98 a gallon to $5.99.
In Harrisburg, the level of constituent outcry on gas prices depends on which lawmaker is speaking.
“It is top of the list. People are so stressed right now,” Democratic Rep. Mandy Steele of Allegheny County said of where gas prices fit among constituent complaints. Even though they know state government has little control over gas prices, she said, “They want me to know they are stressed and struggling.”
Republican Rep. Keith Greiner of Lancaster County, meanwhile, said he has heard from hardly anyone on the topic.
For businesses, Pennsylvania Manufacturing Association President and CEO David Taylor said, “Anything that increases the cost of transportation is a drag.” At the same time, Taylor believes the high prices will be short-lived as the U.S. gains control of the situation around Iran.
The former CEO of the Pennsylvania Chamber of Business and Industry, Gene Barr, was not so sure. Barr, who also is a previous executive director of the Pennsylvania office of the American Petroleum Institute, said the situation surrounding Iran is too fluid to predict.
At the same time, it can’t be denied that significant effects are being felt by Pennsylvania businesses.
“There are industries where fifty percent of the costs are fuel costs,” Barr said.
A few state lawmakers have floated proposals to lower gas prices by reducing the state gas tax.
One of them, Republican Sen. Jarrett Coleman of Lehigh County, proposed even before the start of the Iran war to get rid of the state taxes on gas and diesel fuel, which are 57.6 cents and 74.1 cents per gallon, respectively.
Coleman did not propose a way to make up the lost revenue for the state. Instead, he said in a memo that the state – with $40 billion-plus coming into the general fund and assorted special funds that get little attention – could “replace the revenues from the gas taxes and prioritize how taxpayers hard-earned money is spent.” His bill conveying the proposal is awaiting action in the Senate Transportation Committee.
More recently, Coleman proposed getting rid of the sales tax break received by data center companies and using the newfound revenue to defray some of the gas tax. Separately, Democratic state Sen. Lisa Boscola of Northampton County has filed bills for the temporary suspension of taxes on both gas and diesel fuel.
Both Taylor and Barr spoke against any gas tax suspensions, because the revenue from those taxes is used to fix roads and bridges.
“They are well-meaning but wrong-headed,” Taylor said. “The tax on gasoline is the primary revenue source for infrastructure that everyone uses.”
The conduit through which gas tax revenue gets spent on infrastructure projects is the state Motor License Fund. Barr called any attempt to crimp the gas tax money going into it a “short-term, short-sighted” idea.
He said, “Every time you put that nozzle into your tank, you are putting money into the Motor License Fund.”
