State gas tax collections dip in May; Diesel up

State gas tax collections dip in May; Diesel up

By MARY SELL, Alabama Daily News

Alabama’s gas tax collections dipped by about $2.5 million, or 6.7% in May, representing a drop in travel in April when the state was at the height of its coronavirus slowdown.

The $35 million in gas tax collected isn’t an apples-to-apples comparison to May 2019 because of the 6-cent tax increase implemented in September.

According to the Alabama Department of Revenue, receipts on the diesel fuel tax, also raised last year, increased in May by $1.9 million, almost 14%, to $15.4 million. 

Overall, gas tax revenue is up 30% year-over-year; diesel tax collection is up 28.5%.

Local governments have been watching gas tax collections that help fund their local road projects. The 2019 Rebuild Alabama Act that will raise the state gas tax a total of 10 cents by 2021 directs a portion of the new revenue to cities and counties.

“I would say if things bounced back in May (represented in June collections) I don’t think this has a significant impact on county construction projects,” Sonny Brasfield, executive director of the Association of County Commissions of Alabama, told Alabama Daily News this week. 

Like other entities, Brasfield said counties have been cautious in making spending plans as they watch COVID-19’s impact on revenues.

“We’re hopeful this is just one month,” Brasfield said. “Hopefully, things bounce back in May. If not May, certainly by June.”

Similarly, Rep. Lynn Greer, R-Rogersville, chairman of the House Transportation, Utilities and Infrastructure Committee, said the gas tax dip shouldn’t have a significant impact if it’s short lived.

“What would concern me more than anything is if we hadn’t added the additional gas tax,” Greer said. “Where would we be then?” 

Most of the restrictions put on businesses in March and April to slow the spread of the coronavirus have been lifted.

Greer said he hopes future restrictions aren’t neccessary.

“I’d support just about anything before I’d support shutting down the state again,” Greer said.