Governor’s office says Oregon not considering a “holiday” on 38 cent state gasoline tax — for now

By ALEX BAUMHARDT/Oregon Capital Chronicle

SALEM — Oregon won’t join other states in considering a pause to state gas taxes, for now, according to Charles Boyle, deputy communications officer for Gov. Kate Brown.

Legislators in more than a dozen states are proposing temporary gas tax holidays or rebates to counter the rising cost of fuel for individual consumers and businesses. A measure to suspend the federal gas tax of 18.4 cents per gallon is being proposed by Democrats in the U.S. Senate.

If passed, it would pause the federal gas tax until next January.

In an email, Boyle said that Brown, “understands a large, unexpected spike in the cost of gas has an impact on working families and businesses alike.”

But, Boyle said, suspending state gas taxes would not come without its own costs.

State and local gas taxes help fully fund the Oregon Department of Transportation. Temporarily losing the federal gas tax would have costs, too. It’s an excise tax and, in combination with federal taxes on alcohol, tobacco and other goods, helps fund grants and projects for state agencies, including Oregon Fish and Wildlife Department.

“It is clear that any such suspensions would have state revenue impacts that would need to be addressed through bipartisan action from the Legislature in coordination with our office and state agencies” Boyle wrote.

Oregon’s state fuel tax is 38 cents per gallon, up 2 cents since a January increase went into effect as part of the “Keep Oregon Moving” law. That law, passed in 2017 to invest in state transportation infrastructure, included increases of about 2 cents every few years, to total a 10-cent total increase by 2024.

More than two dozen Oregon cities, along with Multnomah and Washington counties, also have additional gas taxes on the sale of each gallon.

The City of Portland collects its own 10-cent tax and Multnomah County collects an additional 3 cents.

Timber Unity, the timber industry advocacy group which most famously sent a vehicle convoy to the Capitol in 2020 to protest Brown’s cap-and-trade climate bill, sent the governor a letter Monday requesting she use executive powers to pause the state’s gas tax.

In the letter, Timber Unity co-director Angelita Sanchez pointed to Brown’s use of emergency powers to mandate masks.

“Your execution of those orders demonstrated the breadth and depth of gubernatorial control in circumstances of emergency,” she wrote. “A new crisis is at our door, and it demands a response.”

The group asked that Brown suspend the state gas tax, halve the per mile tax on vehicles over 26,000 pounds from an average of 20 cents per mile to 10 cents per mile and allow commercial vehicles to purchase “off-road” diesel that has a lower tax. “Off-road” diesel is typically reserved for vehicles used in construction and agriculture.

Boyle said that it’s not clear that suspending state or federal gas taxes would have a significant impact on prices for long because those prices are being driven by international events that are subject to change.

  • Oregon Capital Chronicle is a nonprofit Salem-based news service that focuses its reporting on Oregon state government, politics and policy.
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