Gas tax increase on the table as legislative session nears end

Gas tax considered

Despite a budget surplus, a higher tax on gasoline may be one of the last items passed in the current Minnesota legislative session.

ST. PAUL, Minn. (FOX 9) - A higher tax on gasoline may be one of the last items passed in the current Minnesota legislative session.

Democrats have acknowledged it’s back on the table in recent days and FOX 9 asked Governor Tim Walz about it Friday. Walz is on board now, and he’s pushed for a hike before in the previous two sessions since he became governor.

It’s not a done deal at the Capitol yet, but it looks like the third time will be the charm and as you might guess, some drivers aren’t thrilled. As numbers tick up and up at the pump, drivers didn’t embrace the idea of a gas tax increase taking the price a little higher.

"Every little bit counts, but can’t afford that," said John Schlief as he filled up his gas tank in West St. Paul.

"I mean who wants to pay more for gas?" said Ben Golnik a couple of pumps away. "We’ve already got what? $3.50 a gallon."

Minnesota’s current gas tax is 28.5 cents per gallon — more than in the Dakotas, but less than Iowa and Wisconsin.

Democrats at the Capitol are finalizing a plan to nudge it up and link future increases to inflation with the idea being that roads and bridges need work and gas taxes should be dedicated to funding that work.

"The fact is we’re at the same rate we’ve been for two decades," Gov. Walz told FOX 9. "We have more people and more folks on the road. And the cost of everything goes up naturally."

Democrats on the transportation committee haven’t released their plan yet, but they say any gas tax increase would be small. Republicans say it’s symptomatic of a DFL tax strategy that’s expensive for Minnesotans who already pay more than enough.

"Again on top of an $18 billion surplus, they’re raising motor vehicle sales tax," said Sen. John Jasinski, R-Faribault. "They’re making the depreciation on your cars longer. They’re putting a surcharge on your license tags. They’ve talked about a delivery fee of 75 cents for every package."

The Minnesota Department of Transportation has warned of a $27 billion gap in transportation funding over the next 20 years. Governor Walz says an increased gas tax plus matching dollars from the federal government will help the state catch up.

"You get what you pay for," he said.

Even with just three days left in the 2023 session, the plan isn’t final, but it may also include increases to fees for vehicle registration and driver’s licenses in addition to the fee on most deliveries.