Ricketts opposes gas tax holiday, calls it a 'Band-aid'

Gov. Pete Ricketts hit the brakes Monday on the idea of using a gas tax holiday to give Nebraska drivers relief from rising fuel prices.

He said such a solution would only be temporary and, whether done by the federal government or the state, would leave the state short of money to maintain and expand its roads and bridges.

"I'm actually against Band-aid type solutions," he said. "At the end of the day, that money is still going to have to be made up."

Ricketts commented during his monthly radio call-in show. He responded to a man identified as "James in Blue Springs," who asked whether the governor could implement such a holiday to help with inflation at the pump.

Eight states have temporarily suspended their gas tax or a gas tax increase this year, while the idea has been proposed in several others, according to Kiplinger magazine.

Maryland launched the first such holiday, but the 30-day break already ended on April 16. Among the others, Colorado postponed a 2 cents per gallon tax increase from July 1 this year until April 1, 2023.

Legislation to cut the 18.4-cent federal gas tax down to zero for the rest of the year has been introduced in Congress, but has so far failed to gain traction. The proposed holiday would make only a modest dent in fuel prices, which averaged $5.01 a gallon nationally as of Monday.

Drivers could see a little more savings from suspending the state gas tax. Nebraska's gas tax rate is at 24.8 cents a gallon for the first six months of the year. Under state law, it will be adjusted July 1 based on fuel prices and legislative appropriations. 

While opposing a gas tax holiday, Ricketts said current levels of inflation are causing challenges for Nebraskans. The annual inflation rate accelerated to 8.6% in May, the highest in more than four decades, with energy prices leading the way. 

"There is nothing more corrosive to our family's pocketbooks than inflation," he said. 

Ricketts blamed the rise in prices on the Biden administration, including the president's decision to block construction of the Keystone XL oil pipeline. The pipeline was to carry Canadian tar sands oil through Nebraska and connect with refineries along the Gulf of Mexico.

The governor encouraged consumers to use ethanol-blended fuels in their vehicles to save money. He noted that the Environmental Protection Agency has approved the use of 15% ethanol-blended fuel through the summer, in a move directed by President Joe Biden to help curb fuel costs.