Originally created 10/24/06

Georgia gas tax to drop



ATLANTA - The state's gasoline tax will dip by 2.7 cents a gallon beginning in December, the state Department of Revenue reported Monday.

The change comes because the market price for gasoline has dropped 25 percent below the average retail price for gasoline in Georgia.

That automatically triggers a recalculation of the state rate under the law adopted in 2004, state officials said.

Although the announcement comes just two weeks before the Nov. 7 general election, state Revenue Commissioner Bart Graham said the change was driven by state law, not by political considerations.

"If there's a 25 percent movement in the market price up or down we are required by law to reset the price," Mr. Graham said.

The change affects only the prepaid state sales tax portion of the motor fuel tax.

That portion of the tax drops from 10.2 cents a gallon to 7.5 cents a gallon.

The price for a gallon of gasoline also includes a 7.5 cent state excise tax, 18.4 cents in federal taxes and a local tax portion that varies from county to county.

In July, the state boosted the state sales tax on gasoline by 2.4 cents a gallon, driven by a formula which automatically adjusts the state motor fuel sales tax every six months.

This summer, Democrats were calling on Republican Gov. Sonny Perdue to roll back the state sales tax on gasoline to combat soaring prices as he did after Hurricane Katrina, but gas prices across the nation have taken a dive since then.

The average price for gasoline in Georgia is now $2.08 gallon, compared to $2.86 in July, according to AAA.