Truth, Inspiration, Hope.

New York State Implements a ‘Gas Tax Holiday’ Amid Record High Prices

Published: June 1, 2022
Gas prices are displayed at a Brooklyn gas station on March 08, 2022 in New York City. Gas prices are at record highs around the country as the Russian invasion of Ukraine causes global oil markets to surge. American President Joe Biden announced a ban on Russian oil imports into America. (Image: Spencer Platt/Getty Images)

As of June 1, New Yorkers will see some relief at the gas pumps after the state implemented a “gas tax holiday” amid record high gas prices.

The move was originally proposed earlier this year, when inflation soared to levels not seen in decades driven in part by Russia’s invasion of Ukraine, skyrocketing oil prices, Biden’s energy policies, and fallout from COVID-19 measures implemented by various governments.

As of May 31, the average price per gallon in New York state was $4.93, a 60 percent increase compared to the same time last year when it was just $3.08, according to AAA.. 

The national average sits at $4.67 per gallon.

The state’s gas tax adds 48 cents to each gallon pumped by New Yorkers. The “holiday”, which expires on Dec. 31 this year, was passed in the state’s budget  in April. It removes the state’s motor fuel and sales tax, cutting approximately 16 cents a gallon.

Numerous counties had already taken action and implemented caps on their local sales tax on gasoline including Dutchess, Monroe, Onondaga and Oswego counties.

Municipalities typically collect a flat-rate sales tax on each gallon, rates that range between eight and 12 cents per gallon, depending on the county. 

These municipal caps are set to expire in November and December this year. 

New Yorker’s need to know that it may take several days for price adjustments to emerge as retailers wait for their next deliveries.

Over the seven months that the holiday will be in effect the state expects to lose around $585 million in revenue, which will hit the state’s general fund. 

Just over 80 percent of that revenue would be typically earmarked for repairs of roads, highways and bridges while the remainder would go to mass transit subsidies. 

On Tuesday, Sen. John Mannion, D-Geddes, tweeted that the suspension will save New Yorker’s an estimated $600 million. 

“Rising gas prices hurt families and our economy and we are doing everything possible at the state level to lower costs,” he said last week during a media appearance with Assemblymember Pamela Hunter, D-Syracuse.

‘Dangerous precedent’

The move has drawn the ire of local climate groups, who argue the suspension only encourages driving and increases greenhouse gas emissions.

“This sets a dangerous precedent and opens the door to setting triggers for suspending this important revenue if gas prices go too high or raiding the revenue for other uses,” Lisa Daglian, executive director of the Permanent Citizens Advisory Committee, said in April.

In response to this, assemblymember Angelo Santabarbara (D-Rotterdam) argued that many communities, particularly those in upstate New York, are built for a driving populace and lack adequate mass transit systems which makes cutting down driving nearly impossible for many. 

“To say we want to discourage people to drive means that people aren’t going to work, people aren’t going shopping, people aren’t going to visit their families,” he said the same month as Daglian’s comments.

Later in May, Santabarbara sent a letter to New York’s congressional delegation, imploring them to suspend the federal gas tax, saying that “families deserve all the relief we can provide.” He added that “while we have done our part here in New York, suspending the federal gas tax can have a greater impact and help working class families save more of their hard-earned money during this crisis.”