Replace Motor Fuel Taxes With Additional Sales Tax

If approved by the voters of the state at the November 2020 general election, the concurrent resolution will amend the state constitution to require the general assembly to enact a law that will:

• Effective July 1, 2021, repeal existing state excise taxes on gasoline and other liquid motor fuel, including diesel, compressed natural gas, liquefied natural gas, and liquefied petroleum gas (motor fuel taxes); except that the law shall not repeal the existing state excise tax on aviation fuel used for aviation purposes;
• On and after July 1, 2021, levy an additional state sales and use tax (additional sales tax) at a rate calculated to generate the amount of net revenue needed to offset 99% of the state revenue loss resulting from the repeal of the motor fuel taxes for state fiscal year 2021-22; and
• Require the net revenue generated by the additional sales tax to be credited to the highway users tax fund (HUTF), initially allocated to the state, counties, and municipalities in a manner that preserves existing HUTF allocations as nearly as possible, and used exclusively for the construction, maintenance, and supervision of the surface transportation system of the state.

The concurrent resolution specifies that for purposes of the Taxpayer's Bill of Rights, its approval by the voters of the state constitutes voter approval in advance for the state to levy the additional sales tax and to retain and spend all revenue generated by the additional state sales and use tax during a state fiscal year that exceeds the amount of revenue generated during the 2020-21 state fiscal year by the repealed gasoline and special fuel taxes as a voter-approved revenue change.

(Note: This summary applies to this concurrent resolution as introduced.)