Utah has not raised its gasoline tax in 17 years, but lawmakers took a first step Wednesday toward possibly increasing it automatically every year — if the price of fuel also goes up.
The Senate Revenue and Taxation Committee voted 6-0 to endorse SB60 and sent it to the full Senate.
The current gasoline tax is 24.5 cents a gallon. The bill would change the calculation annually. It would keep 14 cents a gallon as a base. The rest would be determined by multiplying 3.69 percent times the previous year’s average price per gallon of gasoline before state and federal taxes are added.
Sen. John Valentine, R-Orem, the bill’s sponsor, said it is written so that gasoline taxes would stay the same for the first year. But if fuel prices increase in the future, taxes would also increase automatically with them.
It also has a provision so that the overall tax could not fall below the current 24.5 cents a gallon, no matter how gasoline prices rise or fall.
Valentine said he figures that if his bill had been in place since 1997 — the last time the state’s gas tax went up — it would have generated another $280 million in revenue for highways.
The measure comes as the Legislature has spent a year studying how to make up a projected $11.3 billion shortfall during the next 30 years for planned, high-priority highway and mass-transit projects.
"This clearly moves in the right direction," said Roger Tew, representing the Utah League of Cities and Towns. "It’s a very positive first step."
Andrew Gruber, executive director of the Wasatch Front Regional Council, a transportation planning group, said the time has come to do something.
"We’ve got a 40 percent decline in buying power from the gasoline tax when it was last adjusted," Gruber said. "At the same time, our population increases dramatically."
Valentine noted that because of more fuel-efficient vehicles, the state has been selling about the same amount of gasoline in recent years — even though there are more drivers. So the current gas tax is not keeping up with growing needs.
Brent Gardner, executive director of the Utah Association of Counties, said 60 percent of counties’ highway budgets now come from property tax instead of gasoline tax, because of its decline in buying power. He said it makes more sense for road users to pay for road construction and maintenance.
Sen. Howard Stephenson, R-Draper, who is also president of the Utah Taxpayers Association, agreed. "Users should pay as much of the full price as we can get."
For that reason, Stephenson said he prefers Valentine’s bill over a competing proposal being floated by Rep. Johnny Anderson, R-Taylorsville. It would cut the current gasoline tax in half, and at the same time increase sales tax by 0.2 percent on every other purchase Utahns make including, potentially, food.
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