Sales Tax On Gasoline

Maryland – On Monday, Governor Martin O’Malley wants to raise the state’s gasoline tax by applying Maryland’s 6% sales tax to each gallon of gasoline. His plan has a 2% per year phase-in of the tax at the wholesale level. The sales tax would rise or fall with gasoline prices.

O’Malley plans to send a proposal this week to the legislature. He said, “what all of us are paying right now in terms of idling in traffic congestion, time away from family, time away from work, that all of that is more expensive in the longer term than making this investment in transportation.

Many residents oppose the increasing cost of gasoline with the added tax. While wholesalers would pay for the tax, Comptroller Peter Franchot said such tax would likely increase the cost for gasoline retailers too.

Seven states currently asses sales tax on gasoline, with neighbor Virginia’s total gas tax at above 20 cents a gallon.