Good news for drivers as Maryland’s gas tax goes down slightly starting July 1st

31 May 2024- They say every penny counts, and that’s especially true in Maryland as just under a penny is going to be shaved off the state’s motor fuel tax rates starting on July 1st.

With most states, Maryland and Pennsylvania included, begin their fiscal year on July 1st every calendar instead of January 1st, so many fiscal changes kick in on that date. In Maryland, the gas tax fluctuates year by year, with it being directly tied to inflation after the change was signed into law in 2013. The law also stipulates that “on or before June 1 of each year, the Comptroller shall determine and announce the growth in the CPI for all urban consumers” and the “motor fuel tax rates effective for the fiscal year beginning on the following July 1”.

This year, the gas tax has fallen from $0.4700/gallon on gasoline and gasohol (the common mix of ethanol and gasoline available at most pumps) to $0.4610/gallon. This is all calculated by adding the Sales and Use Tax Equivalent (SUTE) rate and the CPI. Since gas prices have gone up compared to last year, the SUTE rate was decreased by $0.02/gallon, with the CPI necessitating a $.011/gallon increase. So therefore, $0.02-0.011 totals to a shaving of the rate down to $0.4610/gallon. A lot of complicated math to get a total savings to consumers of…..less than a cent a gallon.

But this is reportedly the third decrease in the gas tax since the GA signed the previously mentioned law in 2013. This number is still significantly lower than Pennsylvania, who sees a monstrous $0.576/gallon allocated towards the state’s coffers. The cheapest by far in the tristate remains West Virginia, who’s gas tax totals only $0.3570/gallon of gasoline or gasohol.

In the long run, is it much of a change? Not really. But like previously mentioned, every penny matters. Even if it’s only 9/10th of a penny.