Hawley Announces Gas Tax Cap Agreement

May 11, 2006

Assemblyman Steve Hawley (R,I,C-Batavia) announced today that the New York State Legislature has reached a bi-partisan agreement to cap the state tax on gasoline, saving motorists four cents per gallon. The agreement awaits the governor’s approval, who has yet to publicly state his support.

The State has been reaping a windfall of up to $120 million over the past year because as gas prices rise, the sales tax, which is pegged to the cost of a gallon of gasoline, increased as well. Hawley believes returning the windfall to taxpayers is the right thing to do.

Hawley has been calling for a cap on the state sales tax for weeks and had expressed disappointment with the Assembly majority after a minority amendment was defeated 77-64 on April 11th. 77 majority members voted against the bill.

“I hope our majority counterparts will do what is right this time around,” said Hawley. “New Yorkers from all over the state have been calling for relief. Our conference has been there since day one with a plan, and it’s time they follow our lead.”

The bill, to be voted on next week, would take effect June 1st and could save taxpayers up $450 million. Under the new agreement, the gasoline sales tax would be capped at eight cents per gallon, equal to what the state collects on $2 per gallon. With gas prices around $3 per gallon, motorists are paying the state approximately 12 cents per gallon.

While Hawley believes the tax cap is a good first step towards relieving pain at the pump, he is also calling for support of the Alternative Fuel Incentive Fund, which will offer tax breaks and incentives to citizens, corporations, and research institutions for the development and use of alternative fuels.

“We are making progress,” said Hawley. “But this state will not be free of overly burdensome fuel costs until we enact programs that will end our dependence on fossil fuels and our addiction to foreign oil.”

On Monday, the Assemblyman joined Governor George E. Pataki and State Senator George Maziarz in Medina, Orleans County, to announce nearly $6 million in state funding to assist Western New York Energy (WNYE) in the development of the first state-of-the-art dry mill ethanol plant in New York state.

“By transitioning to ethanol and other alternative fuels, we will be saving New Yorkers money, increasing job growth, and revitalizing the farming industry of this state,” said Hawley.

In the meantime, the Assembly minority conference is hopeful this bill will pass, so that as Hawley points out, “we can move on to longer-term ideas that will be the future of fuel and energy sources for New York state.”