On Sept. 12, Governor Brian Kemp issued a State of Emergency in Georgia due to rampant inflation that has been negatively impacting the social and economic well-being of residents.
In August alone, inflation was up over 0.6%, with the increase in gas prices accounting for over half of the uptick in the overall inflation rate.
The costs of essentials such as housing, food and gasoline have risen since July of last year. The average household spends an extra $202 more per month for the same services since last year and $709 more per month since two years ago. The oil price is at the highest it has been in 10 months. The average price of gasoline has also increased by about 30 cents in the last year, going up from $3.24 to $3.57.
“From runaway federal spending to policies that hamstring domestic energy production, all Bidenomics has done is take more money out of the pockets of the middle class,” said Kemp. “While high prices continue to hit family budgets, hardworking Georgians deserve real relief and that’s why I signed an executive order today to deliver it directly to them at the pump. Working with partners in the General Assembly, we’ll continue to help Georgians weather the economic headwinds caused by this president, his administration, and their allies in Congress.”
The suspension took effect on Sept.13, at 12:00 a.m and will remain in force until Oct. 12.
Without the gas tax, Georgians are predicted to save over 31.2 cents per gallon of gasoline and 35 cents per gallon of diesel. This mirrors a tax suspension that took effect in Georgia last year, where the net savings
totaled up to $1.7 billion.
“I applaud Governor Kemp’s suspension of motor fuel taxes to keep our people and our economy moving despite Washington’s inaction on rising fuel prices,” said Georgia State Representative Jon Burns.
Gas taxes are not collected in the same way as sales taxes. Gas taxes are paid in advance when gasoline retailers buy gas. The tax is part of the price per gallon. With the gas tax suspension in place, retailers must apply for refunds to get their money back. The expectation is that retailers — such as major gas station companies — will pass these savings on to the consumer and lower the price per gallon, though this is not the law.
Georgia is not the only state to offer gas tax suspensions due to rising prices. In Mar. 2022, Gov. Larry Hogan of Maryland signed a bill for a 30-day gas tax holiday to help ease the burden of surging gas prices on consumers. Florida and Connecticut also had a similar 30-day relief period.
Srihita Ayinala, third-year CS major, said, “As someone who doesn’t live in the United States and is not from here, this is a huge relief. Being in the United States, prices are much higher than I ever expected, and especially recently owning a car has been very tough. I barely drive anymore because with parking and gas prices, I can barely afford to. When my dad told me I could expect lower gas prices this month, it came as a relief to me. I already pay so much for groceries and general living, and the fact that I can find some cushioning when it comes to filling my tank up makes me happy. I think this gas tax suspension will be very important to many Georgia citizens as well. What I can say is that I haven’t seen a change yet, but it has only been a week and I’m hoping for more outputs soon.”
There are some criticisms of the tax suspension as well. Some professionals state that tax suspensions can interfere with the natural supply and demand. With low prices, demand will rise despite supply being naturally lower.
Another argument is that the reduction of taxes means that there will be less money to supply for other state improvements such as road improvements or general revenues.
Some areas of Georgia are already experiencing the price drops, but the changes are expected to stabilize some time in the near future.