Gas Tax Freeze Saves West Virginians an estimated $50-$55 Million 

CHARLESTON, W.V.—West Virginia Governor Joe Manchin III and State Tax Commissioner Christopher G. Morris today announced the current freeze on the motor fuel excise tax  will save West Virginians approximately $50-$55 million through December 31, 2009.

Earlier this year, Governor Manchin called a special session asking legislators to help bring relief to taxpayers by freezing the wholesale tax, or variable rate, portion of the motor fuel excise tax. Legislators passed a bill locking the wholesale tax on motor and special fuels, such as those used to heat homes, at 11.7 cents a gallon through December 31, 2009.

“In these difficult economic times, I’m grateful that we have the financial health and ability to provide this tax relief to our citizens,” Manchin said. “Everyone is very concerned about our nation’s economy and we all are tightening our belts to make it through. I know that our families need this freeze because every dollar we can keep in our wallets is going to help.”

The governor said that even with falling fuel prices today, due to the high summer prices of gasoline, the per-gallon tax would have increased in January if the Legislature hadn’t approved the freeze the governor requested.

By law, each year the State Tax Commissioner must look at the average wholesale price of all fuels (gasoline, kerosene, diesel, etc.) sold in West Virginia between July 1^st and October 31^st. The following year’s wholesale motor fuel tax is based upon 5% of the average price found during that time period.

“Based upon the average wholesale price of motor and special fuels this year, the consumer will be saving 3.7cents a gallon due to the freeze requested by Governor Manchin and passed by the West Virginia Legislature,” Morris said. “This is a savings that occurs not only at the gas station, but at home as well for those homeowners who use special fuels to heat their homes.”

In anticipation of lower revenues to be collected due to the freeze, lawmakers set aside $40 million for the State Road Fund should the Department of Transportation need the revenue. To date, $12.6 million has been used.

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