O'Malley Gas Tax Plan Adds 20 Cents Per Gallon

The Maryland governor said he will explore adding a 6 percent sales tax to the current 23-cent flat tax on gas, in order to pay for transportation upgrades.

Maryland Gov. Martin O'Malley said he will propose adding a 6-percent sales tax to the existing tax on gasoline, as a way to help pay for road improvements in the state.

In an interview with WTOP radio on Monday, O'Malley said he wants to end the sales tax exemption on gasoline and called the current method of taxing gasoline "outdated."

Currently, gas is tax at 23-cents per gallon and is exempt from the state sales tax.

"We haven't had any increase in our primary source of transportation funding since the early 1990s," he said. "The best option, it would seem to me, would be to get away from the flat tax and move toward a percentage."

O'Malley said he'd recommend phasing in a 6-percent sales tax in addition to the 23-cent flat tax. The sales tax would be phased in by 2 percent each year for three years.

O'Malley said that if the state had indexed the gas tax in the mid-1990s, the state would have an additional $4 billion in its budget.

The governor said the money would go toward transportation solutions. When asked by reporter Mark Seagraves if he'd support legislation to protect money for transportation from being spent on other needs, O'Malley responded, "Yes."

Members of the business community, including the , have in the state. O'Malley's plan, however, differs from the plan recommended by the state's Blue Ribbon Commission on Transportation Funding, which called for a 15-cent increase in the gas tax, phased in over three years.

The average price of gasoline in Maryland is now about $3.50, meaning that a 6 percent sales tax would add roughly 21 cents to the price after three years.

The blue ribbon panel had recommended raising more than $800 million annually through a combination of increases in the gas tax and on a variety of fees, including vehicle registrations. O'Malley's plan would raise more than $600 million each year by simply adding the sales tax.

O'Malley said the economy will benefit from more road projects and the reduction in congestion.

"None of us likes this," he said. "But the cost to us of doing nothing is greater. And to do nothing is irresponsible."

O'Malley will offer more details on his transportation plan during his State of the State address on Wednesday.

mark johnson January 31, 2012 at 04:23 PM
O'Malley = Owe Malley
Mithrandir January 31, 2012 at 04:50 PM
If it turns out that additional revenue is needed for the transportation infrastructure, any new taxing authority that is created needs two things: 1. Criminal penalties for anyone in the government who uses the tax revenue for other than the transportation infrastructure, and 2. An automatic revocation of taxing authority if the transportation tax revenue is used for anything other than supporting the transportation infrastructure.
STEVE CONNOLLY January 31, 2012 at 05:10 PM
I agree with that %100, plane fact is they won't agree to it.
JustABill February 02, 2012 at 07:07 AM
Way to go Maryland Democrats! How can you continue to vote for people like Gov. O'Malley, Sen. Miller, Del. Bush, and all the other tax and spend liberals who are so far out of touch with the trials and tribulations of the citizens of Maryland. If my notes are correct in just the few short days this General Assembly has been in session, Owe'Malley has asked for a 15 cent increase to the current gasoline tax, a 17.33% (1 cent) increase to the state sales tax, and now an expansion of the sales tax overall to include gasoline adding another 7 cents per dollar to the overall price for gasoline. They have not disclosed the other products and services the expansion of the sales tax will cover, but when they tried before it was 43 items including most "services" that have never had sales tax applied to them. Sales tax is supposed to apply to an actual product that is sold not a "fee" for a service provided that does not include an actual product. So the Democrats who lie through their teeth about how they are the party that will look out for the poor and working class will pass not one, not two, but at least three tax increases or new taxes that will have the most negative impact on the poor and working class citizens of Maryland possible in this horrific economy. Way to put other people's money where your mouth is Gov. Owe'Malley. Then he says the taxes are needed to increase revenues to maintain schools, roads, and bridges. These are not the droids you're looking for!
JustABill February 02, 2012 at 07:13 AM
Also this article missed one major point. If Owe"Malley gets his Tax & Spend wishlist granted by his fellow democrats in the General Assembly then it will be a 7% sales tax added to the price of gasoline not a 6% sales tax because he also asked to have the sales tax increased from 6 - 7%. That would be two increases of 20% and now 17.33% to the sales tax since he took office and it was not touched for over 30 years before he was elected. Welcome to Maryland! What's in your wallet?


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