Senator Robach announced today that the State Senate and Assembly gave final legislative approval to legislation to provide New Yorkers with relief from high gas prices by capping and reducing the sales taxes on gasoline. The bill would cap the State sales taxes on gas at 8-cents per gallon, effectively freezing the tax at the $2 per gallon rate. The gas tax cap would save New Yorkers as much as $450 million annually at the pump. The cap on the State sales tax on gas would take effect on June 1, 2006.
"Everyday, the working men and women of our community are telling us that taxes are too high," Senator Robach said. "The tax relief provided in this legislation will be realized by both employers and residential motorists alike and will have a huge positive impact on a major aspect of our everyday life. Requiring that these savings be passed on to the consumer will ensure that the benefit of this tax relief will go to those who need it most."
The measure requires that service station owners pass along the savings to consumers. The State Commissioner of Taxation and Finance, in conjunction with the Chair of the State Consumer Protection Board, would be charged with enforcing the cap. There would be a fine of up to $5,000 per incident, per day, for stations that do not pass along the savings.
"This important legislation is about more than just reducing the price at the pump," Senator Robach added, "It's about cutting taxes in New York State. I am pleased that the Senate was successful in reducing the gasoline sales tax. The state will no longer reap windfall profits from the pockets of hardworking taxpayers."
In addition, the bill (S.7909) would:
> Allow New York City to reduce or eliminate its local sales tax on residential home heating fuels;
> Provide consumers with a tax credit for the purchase of home heating oil that contains biodiesel fuel. The credit would be equal to the percentage of biodiesel contained in the fuel, i.e. a 10-cent per gallon credit for heating fuel containing 10 percent biodiesel;
> Create a tax credit for the purchase of energy efficient residential home heating systems. The credit would be equal to 50 percent of the purchase and installation costs, not to exceed $500; and
> Require the State Thruway Authority and NYSERDA to develop a plan to make alternative fuels, such as ethanol, available at Thruway service areas.
The bill was sent to the Governor.