The Ohio state legislature has until April 1st to present Governor Mike DeWine a two-year transportation budget. As this deadline looms closer, a potential gas tax hike seems to be becoming more and more of a reality for the Buckeye State.
In February, Governor Mike DeWine proposed a 64% increase to the Ohio state gas tax to the 133rd General Assembly. His proposal would take Ohio’s gas tax rate from 28 cents/gallon to 46 cents/gallon – a 18 cent increase – and provide for the tax to be indexed to inflation annually.
In early March Ohio House of Representatives introduced and passed its two-year transportation budget bill, HB-62, containing a revised gas tax hike. Under the bill, a 10.7 cent/gallon increase that would be implemented over the course of three years, starting in 2019, with no provision to index the tax to inflation.
The Senate Committee on Transportation, Commerce, and Workforce is now considering amendments to the bill, which should be introduced on the Senate floor by Thursday afternoon. Senate President Larry Obhof and Transportation, Commerce, and Workforce Committee Chair Rob McColley, among others, have expressed skepticism as to the need for a gas tax hike and plan to include an offsetting income tax cut should the hike go forward.
The last time Ohio made a change to its gas tax was 2005. This is for good reason:
- Gas tax hikes failed to appropriately address budget shortfalls in the past, according to a report by the Center on Budget and Policy Priorities, and will do so again.
- The gas tax is regressive, meaning the lowest income citizens bear the greatest burden. With gas tax prices that have been creeping up in Ohio, such a tax hike would have especially adverse effects on the state’s lower income earners.
- Ohio and Ohioans have reaped the rewards of common sense tax policy and federal tax reform but a gas tax hike works against those benefits. A gas tax hike would serve to eliminate 60% or more of the benefits individuals saw from federal tax reform.
Ohioans cannot afford an increased tax burden of any size thanks to a gas tax hike. The Ohio legislature must reject efforts to raise the gas tax or ensure that Ohioans’ tax burdens are not affected by cutting other taxes.