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As gas prices rise, officials consider cutting or capping gasoline taxes

A motorist fills a vehicle with gasoline at a Shell station Friday, Nov. 5, 2021, in southeast Denver. (AP Photo/David Zalubowski)
A motorist fills a vehicle with gasoline at a Shell station Friday, Nov. 5, 2021, in southeast Denver. (AP Photo/David Zalubowski)

SYRACUSE, NY (WRVO) - With gas prices continuing to surge in New York, state and local lawmakers in central New York have proposed cutting or capping gas taxes as one way to ease the pain at the pump.

Gas in New York averages over $4.46 a gallon according to AAA, and it’s unclear when this surge, spurred by inflation and the war in Ukraine, will ease. But the price at the pump isn’t only the cost of gasoline. There is a cocktail of taxes and fees levied by federal, state and local governments. It adds up to nearly 68 cents per gallon of gas sold in New York. And that’s where state Sen. John Mannion (D-Syracuse) thinks relief can be found. He’s proposing the state stop charging gas taxes at a certain price point.

“Cap the tax at $3.09 a gallon,” Mannion said. “And the reason the number is there, is that is number that NYSERDA has as the average price from last year, and therefore what the expected revenue would be. So people would not pay a penny above that number."

Mannion isn’t the only one suggesting changes to the state gas tax. Others suggest scrapping the state’s gas tax entirely. But Mannion thinks his proposal, which is being pushed in the Assembly by Syracuse Assemblywoman Pam Hunter, is a kind of sweet spot. Mannion said it offers relief, without making many changes to the state budget being negotiated in Albany.

“People are suffering from this, we want to get them relief as soon as possible,” he said. “And we are cautiously optimistic we can move this quickly.”

The smallest fees among all those rolled into the cost of a gallon of gas comes from counties. And that’s where Onondaga County Executive Ryan McMahon thinks help can be found.

"We’re proposing to cap the sales tax on gasoline at $4 a gallon,” McMahon said. “This would change the way we tax gas.”

Onondaga County charges a 4% sales tax per gallon. Capping the tax at $4 per gallon means the county would not collect more than 16 cents per gallon sold in the county.

Like Mannion’s proposal, McMahon said keeping some gas tax revenue is important.

“This is one way we know can provide temporary relief, understanding we have a lot of other challenges related to the pandemic and post-pandemic,” McMahon said. “We just funded these programs, so we can’t risk revenue models getting blown up because then these funding priorities could get blown up as well."

It’s unclear how long it would take for any state relief to come. Onondaga County lawmakers could take up the issue at their April meeting, and Legislature Chairman Jim Rowley expects a lot of support.

“Any time the county executive comes forward with a proposal to cut taxes, it’s a good day in Onondaga County,” Rowley said.