5/28/04-With fuel prices in Pennsylvania reaching record levels, two state lawmakers May 25 proposed temporarily reducing the fuel tax by 12 cents a gallon. Gov. Ed Rendell dismissed the plan as “a bad idea.”
Sen. Allyson Schwartz, D-Philadelphia, and Rep. Peter Daley, D-Donora, said the current high price of fuel not only forces drivers to pay more to operate vehicles, but also inflates the cost of most consumer goods.
Gov. Rendell said he understood people were frustrated over soaring fuel prices, but that the legislation would have little effect on prices and would cut into revenue needed to maintain the state’s highway and bridges.
As of May 28, the average price of a gallon of diesel fuel in Pennsylvania was $1.85 with gasoline at $2.05, compared with $1.77 and $1.75 a month ago and $1.62 and $1.45 at the same time last year, according to the AAA Web site.
Unprecedented demand on oil reserves, unfavorable monetary exchange rates, and declining refinery and storage capacity in the United States are among the factors blamed for the increases.
Schwartz’s and Daley’s proposals would trim the state tax on diesel from 31 cents a gallon to 19 cents while cutting the gasoline tax from 26 cents to 14 cents for as long as six months. The reduction would be suspended after three months if the average price has declined to less than $1.80 a gallon.
Any lost tax revenue could be made up by using a portion of the projected $400 million surplus in this year’s state budget, Daley said in a statement, ensuring money would not be taken from roads.