Ohioans will save an estimated $725 million in fuel taxes at the pump over a 90-day period following a vote by the Ohio Senate to suspend the state’s motor fuel tax. State Senator Kyle Koehler (R-Springfield) joined his colleagues in passing the legislation, which cuts the current tax rates to 1/100th of a cent per gallon for accounting purposes.
Motor Fuel Tax Rates and Projected Savings
The suspension cuts deeply into the state’s standard fuel levies. Ohio’s current Motor Fuel Tax applies a 38.5 cent tax per gallon of gas and a 47 cent tax per gallon of diesel.
“Providing relief in the face of rising prices is good governance,” said Senator Koehler regarding the vote. “By enacting a fiscally responsible plan to suspend the gas tax, Ohioans will see savings that they can apply to other areas of their budget. I’m proud to have supported this legislation and look forward to seeing the positive effect it will bring to Ohio.”
Impact on Border Counties and Infrastructure Funding
The legislative reduction to 1/100th of a cent per gallon includes a specific structural safeguard. The adjustment protects certain border counties from seeing unintended tax consequences caused by neighboring states levying their own taxes on fuel sold into Ohio.
To prevent disruption to local infrastructure, the state will not tap into its “Rainy Day Fund,” also known as the Budget Stabilization Fund. Instead, funding for highway construction projects and local governments usually covered by the motor fuel tax will draw from budget surpluses accumulated during the current fiscal year.
Keep reading