Fuel tax savings just before the gubernatorial election - coincidence?
The various sales tax holidays signed into Florida law by Governor Ron DeSantis on May 5 are intended to save Floridians up to $1.2 billion in the coming months. It's a significant amount of money, but may seem like a drop in the ocean for those who are struggling to make financial ends meet right now.
One of the most hotly-anticipated sales tax holidays that will affect most citizens, is the one month suspension of sales tax on fuel, intended to save $200 million for Florida's taxpayers by shaving 25.3 cents per gallon off the price of fuel between October 1 and October 31.
While many will benefit from the savings, the question remains why the tax holiday won't take effect for 5 months when so many are struggling financially right now. In neighboring Georgia, Governor Kemp suspended fuel tax in the state back in March, and the suspension remains in place until the end of May.
The reason behind the delay in implementing Florida's fuel tax suspicion could be that the tax holiday will occur immediately in the run-up to the gubernatorial election in November 2022.
Perhaps the governor is hoping that voters are sweetened by the tax break as they head to cast their vote?
What happened to $1 billion of gas tax savings?
In November last year the governor announced an intention to propose $1 billion of gas tax savings to the state legislature. While these weren't approved, the $200 million encompassed in the savings packaged within HB7071, signed on May 5 seem like the next best thing.
Gas prices remain high
What couldn't have been foreseen back in November 2021 was the Russia-Ukraine conflict that would begin in early 2022 and which has had a catastrophic effect on the cost of oil around the world as well as destroying the social fabric of the Ukraine itself.
While the price of oil soared to over $120 per barrel at one point, it's since dropped back to hover around $100. In spite of this, Floridians don't seem to be seeing cheaper gasoline and diesel at the pumps.
Meanwhile, oil companies are making record profits
Perhaps most annoying for motorists struggling with the cost of fuel, is that at the same time prices are going through the roof, oil companies are reporting record profits. In February, oil giant BP reported the highest levels of profit in 8-years - $12.8 billion net profit in 2021. Exxon reported profits of $5.8 billion in the first quarter of 2022.
While Florida's drivers will no doubt appreciate the relief of cheaper gas in October of this year, as citizens of the state struggle right now with the heightened cost of living, many will be wondering why the tax cuts can't come sooner.
Do you think the governor's tax cuts are enough to help out the average Floridian? What's the most expensive gas you've seen in the state? Let me know in the comments section below.