LANSING — Michigan will soon be adopting a new model for taxes on gasoline as part of a long-term road funding plan.
The state’s 6% sales tax on gas will be eliminated in favor of a flat 51 cents per gallon tax, up form 31 cents previously.
The changes will go into effect Jan. 1 and are part of a multi-billion dollar road plan that shuffles money between different state entities.
“What it does is it takes the sales tax and replaces it with an equal gas tax,” said Rep. Tom Kunse, (R) District 100, Clare. “It’s like taking $1 out of your right pocket and putting $1 in your left pocket. It’s the same amount of money.”
Lawmakers and fiscal analysts say they don’t anticipate any significant impact on consumer prices.
“If it wasn’t public, no one would notice the difference at the pump,” Kunse said. “This is revenue neutral. We’re not raising taxes. We’re not lowering taxes. It’s just an accounting change, but it’s a sustainable road funding mechanism.”
The changes also ensure that all taxes paid at the pump go toward road funding, a policy that lawmakers have trying to pass for years.
The plan will also provide more funding for local governments and their roads.