Fuel Tax Relief  -States Take Action

Fuel Tax Relief  -States Take Action
May 5, 2022 0 Comments

With gas prices hovering above $4.00 per gallon, Americans are desperately seeking relief at the gas pump. Some states have successfully taken action to help consumers, while others are considering options to lessen the financial impact of a fill-up. On the other hand, some states have stated that they have no intention of intervening in the skyrocketing gas costs for whatever reason.  

At TiP Excise, we know how important it is to save money on your fuel by any means possible. We operate for the sole purpose of helping you find ways to file for a return of the excise taxes you’ve paid on your fuel purchases. We’ll circle back around to how TiP Excise can help save you money, but first, let’s see what relief is being offered at state level. 

 States Offering Fuel Tax Relief 

 After credit for federal tax on fuels legislation was denied, some states have taken it into their own hands to attempt to provide their taxpayers some fuel tax relief. Although proposals to limit or provide fuel tax credit have been introduced in more than 20 states, only 5 states have so far succeeded in implementing fuel tax relief legislation. 

  • Connecticut – Temporarily lifted fuel tax from April 1-June 30. 
  •  Georgia – Paused fuel taxes for 10 weeks, until May 31st. Also approved tax rebates. 
  •  Maryland – Paused the fuel tax on gas and diesel for 30 days back in March.  
  •  New Mexico –  Offering gas tax rebate, paid in both June and August. 
  •  New York – Suspended state fuel taxes for seven months. 

States Still Working on Fuel Tax Relief Legislation 

  • Idaho – Offering gas tax rebates.  
  • Indiana – Approved a one-time tax refund. 
  • Maine – Taxpayer relief payments starting June 1. 
  • Florida – One-month gas tax holiday, October 2022. 
  • Illinois – Offering tax rebates. 
  • Colorado – Six-month delayed fuel tax increase proposed. 
  • Virginia – Suspend state fuel tax collection for three months, May-July. 
  • California – After a proposal to suspend gas tax failed, now considering a gas tax rebate. 
  • Kansas – Pushing for a tax rebate. 
  • Kentucky – Senate has approved tax refunds. 
  • Missouri – Senate has approved tax credits. 
  • New Jersey – Proposing tax rebates. 

The Argument Against Fuel Tax Relief 

Tax experts and analysts are skeptical of the real consequences of providing gas tax holidays. Most agree that they provide little relief to consumers in the long run, and in fact, have the potential to make the problem worse by not addressing the oil supply, warning that oil companies could increase prices to keep some of the tax cut for themselves.  

Both federal and state gas taxes are used for the upkeep of roads and highways across the country. This is the basis for the claim that current gas taxes are insufficient to keep pace with escalating infrastructure costs. The growing popularity of electric automobiles is just compounding this problem. The worry is that taxpayers looking for tax relief aren’t considering what happens in the future if we fail to maintain our roads and highways. 

What if Your State Isn’t Offering Relief? 

 If you find yourself living in a state that doesn’t seem all too motivated to help taxpayers offset the rising costs of fuel, you should consider taking matters into your own hands. Start planning different logical and smart ways to save money on your fuel consumption.

10 Tips for Saving Money at the Pump 

  1. Track local gas station prices – There are lots of apps available to help find the best deals close to you. 
  2. Earn money back with gas credit cards or fuel rewards programs – If you can’t avoid purchasing fuel, you might as well try to earn rewards for every dollar you spend. 
  3.  Pay with cash – Many stores offer discounts on fuel prices if you avoid paying with credit or with debit cards. 
  4.  Check your tire pressure – You would be surprised how much fuel mileage is affected by tire pressure. 
  5.  Map your route – Every mile is going to cost you, so be sure you aren’t wasting gas finding your way around needlessly. 
  6.  Join a club membership program – Along with the fuel perks, most club memberships offer exclusive deals on tons of other products. 
  7.  Buy discounted gas cards through retailers – With discounted gas cards, you don’t have to wait for gas prices to take a plunge to save money. 
  8.  Learn about fuel efficiency – There are lots of practical ways to save on fuel such as driving the speed limit, avoiding idling, and minimizing air conditioning.  
  9.  Practice hypermiling – Take your fuel-efficiency habits to the next level by parking facing the sun when it’s cold or choosing routes that require less breaking- things like that.  
  10.  Consider non-gasoline-based options – If you can afford an electric vehicle, now is the time to consider becoming an owner of one. Maybe biking or public transit is a good option if you just can’t afford to fill up your car anymore. 

Excise Fuel Tax  

If you’ve never heard of an excise fuel tax, today is the day to learn. An excise tax is a tax that is paid for certain goods or services, paid at the moment of manufacture, rather than at the time of sale. For example, federal excise taxes are imposed on the sale of fuel. Depending on the way the fuel is used by the consumer, there may be a possibility of qualifying for an excise tax fuel credit.  

This is how fuel excise tax credits work. When you purchase fuel, you absorb the costs of added taxes and fees. Although diesel fuel taxes by state and fuel taxes by state differ, they average $0.57 per gallon for gas and $0.64 per gallon for diesel, according to NACS.  However, most customers are unaware that if you use that fuel for “off-road” activities, you may be eligible for a refund of the tax you paid. This is a great way to find some unexpected financial fuel relief.  

Partner with TiP Excise and Save Money 

 Even in states that have passed legislation intended to offer some fuel tax relief, more Americans are feeling let down, seeing that the relief they were anticipating is not nearly enough. Most Americans are searching for ways to save money by any means possible.  

TiP Excise understands this financial burden and we’re here to offer some advice for saving money in a way that most consumers haven’t considered. We evaluate the use of the fuel you purchase and how that could translate into an excise fuel tax credit. 

Contact us today to find out more about the excise fuel tax credit.