Gas Tax Holidays Sound Politically Tempting. Too Bad They Don’t Work.

Gas taxA gas tax is commonly used to describe the variety of taxes levied on gasoline at both the federal and state levels, to provide funds for highway repair and maintenance, as well as for other government infrastructure projects. These taxes are levied in a few ways, including per-gallon excise taxes, excise taxes imposed on wholesalers, and general sales taxes that apply to the purchase of gasoline. prices are soaring across the country, and lawmakers are naturally looking for ways to alleviate the pain at the pump. While gas taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. holidays—which temporarily suspend fuel taxes to artificially lower the price of gas—are a politically welcomed intervention, taxpayers shouldn’t be so quick to celebrate.

In a time of political and economic uncertainty, drivers should be aware that these sorts of gimmicks can be economically harmful. Pausing fuel taxes makes funding roads and highways more difficult while doing nothing to address the underlying issues driving prices upward.

Georgia has become the latest target of this type of counterproductive measure. Governor Brian Kemp (R) recently enacted a 60-day suspension of the state’s motor fuel tax. Yes, gas prices are high today, but with roadway spending in Georgia on the rise, there could not be a worse time to decrease the taxes that are used to fund those very expenditures.