Posted in: Gas Prices,
by Patrick DeHaan on Jul 1, 2013 10:00 AM
Wyoming's first fuel tax increase since 1998 has come into effect today, increasing the tax levied on a gallon of gasoline by a dime, even though it faced stiff opposition in the state legislature.
Wyoming officials have claimed that the increase in gasoline tax will net the state about $70 million more per year year with approximately two-thirds of that amount going to the Wyoming Department of Transportation and the rest being divided up between cities and counties. The increase will see taxes on each gallon rise from 14 cents to 24 cents.
Wyoming's current combined tax (including all levels of taxation- federal, state, and local) amounted to nearly 33 cents per gallon before the hike, the lowest of any of its neighbors. With the increase in taxes, Wyoming will fall more evenly with its neighbors, who currently pay a combined tax of 43c/gal in Idaho, 46c/gal in Montana, 40c/gal in Colorado, 43c/gal in Utah, and the Dakotas at around 42c/gal.
The increase in taxes may not immediately show up at the pump, according to GasBuddy's Gregg Laskoski. “I wouldn’t assume that just because the law goes into effect that the new prices will be immediately implemented,” he said. “It could be a few days or more.”
At the same time, gas taxes in Virginia are dropping because of recent changes there. According to the Times Dispatch, Virginia’s gas tax goes down today, though motorists may not notice it for a while in the pump price.
Starting today, the tax rate for gasoline will be 11.1 cents a gallon, based on 3.5 percent of the statewide average wholesale price for a gallon of gasoline.
Virginia had been levying a tax of 17.5 cents per gallon on all fuels used in highway vehicles. That per-gallon tax has been eliminated in favor of the percentage tax.
The state projects that the new wholesale highway fuel tax will raise $626.3 million for improvements to Virginia’s overburdened and deteriorating transportation system in the 2014 fiscal year, which begins today.
Motorists across the United States should be wary of the increase in Wyoming, as other states have already shown a willingness to raise taxes or are currently in discussions to possibly raise taxes. Several other states have already altered their gasoline taxes, and with already high gasoline prices, motorists could feel an even greater pinch with either higher gasoline taxes or higher sales tax to offset a decrease in gas taxes.