When Michigan Gov. Gretchen Whitmer vetoed a $2.5 billion tax cut plan formed by state Republicans last month, she signaled that a proposal to suspend Michigan’s 27-cent-per-gallon tax on fuel would suffer the same fate.
On Friday, Whitmer made good on that threat, vetoing the legislation that would have suspended the tax for six months. The pause would have been effective in 2023.
She outlined her reasoning in a letter she signed last month, calling the plan “misguided” and saying it “does nothing for Michiganders facing pain at the pump right now.”
Her letter also pointed out it would hinder work projects because the tax helps fund road and bridge repairs.
“(The gas tax proposal) would kill 35,000 construction jobs, handicapping our ongoing work to fix roads and bridges as construction season ramps up and we are all focused on getting Michiganders back to work,” Whitmer wrote. “I know we can collaborate to deliver immediate relief that makes a difference right now.”
State Republicans offered the plan up while gas prices were surging with inflation climbing to a 40-year high and sanctions over Russia’s invasion of Ukraine.
In pushing the plan, Republicans claimed suspending the 27-cent-per-gallon gas tax between April 1 and Sept. 30 would result in a revenue loss of between $725 million and $750 million, which they said could be replaced with surplus funding in the general fund.
A Senate Fiscal Agency analysis estimated the tax suspension would save the average driver about $75 over six months based on driving habits from 2019, according to The Detroit News.
The bill was passed quickly in both the House and Senate, but wasn’t able to get the majority it needed for immediate effect. That pushed the effective date to March 2023.
Whitmer has backed several proposals, including:
- Rolling back the Retirement Tax to save 500,000 households an average of $1,000 per year
- Tripling the Earned Income Tax Credit to put nearly $3,000 in the pockets of 730,000 Michiganders.
- A separate gas tax relief plan that would suspend the 6% sales tax on gasoline.
“These plans will make a real difference for people who are struggling the most right now to afford essentials,” she wrote.
The Michigan Republican Party issued a statement criticizing Whitmer’s veto.
“Once again, Gretchen Whitmer shows her true colors as an out of touch career politician who cares more about climbing the political ladder than to actually help Michiganders at a time of extreme need,” Communications Director Gustavo Portela, said in the statement, according to The News. “Vetoing immediate relief at the pump would have helped Michiganders keep more of their hard-earned dollars at a time when that is needed most.”
