Citing the recent spikes in gas prices, Michigan Senators on both sides of the aisle have reached an agreement to pause gas taxes for the summer. The bills, approved just before Memorial Day, would temporarily suspend both the 27-cents-per-gallon gas tax and the 6 percent sales and use taxes on gas purchases during the period of June 15th through September 15th. Efforts are estimated to save drivers roughly 50 cents per gallon which should do something about Michigan’s current average gas price that hovers at $4.56 per gallon.
In total, the nonpartisan Senate Fiscal Agency estimates the plan could cost the state up to $800 million in lost tax revenue in the current fiscal year — although updated revenue projections show the state continues to benefit from a large $6 billion budget surplus. Governor Gretchen Whitmer has been a supporter of pausing the 6 percent sales tax, but has vetoed earlier attempts to pass such bills due to their effects being delayed until 2023. The governor’s office reported feeling “encouraged” by these new bills passing. “We will monitor this legislation as it advances,” said Bobby Leddy, a spokesman for Whitmer’s office, “The governor looks forward to working with the Legislature on a broader bipartisan agreement that puts Michigan first by cutting taxes and providing real relief right now for our seniors and working families.”
The package will move to the House next for approval, where the bills will most likely sit in wait for at least a week, as many lawmakers will be attending the Detroit Regional Chamber’s Mackinac Policy Conference. Officials have warned that if consumers continue to see high prices through the summer, despite the relief that the bills offered, they should place the blame on gas company CEOs seeking to overcharge consumers.