Georgia Becomes First State to Suspend Gas Tax as Prices Surge

Georgia has become the first state to halt its fuel taxes for 60 days as gas prices climb nationwide due to Middle East conflicts. Other states are hesitant to follow suit, citing tighter budgets compared to the pandemic-era cash surpluses.

ATLANTA (AP) — Georgia has made history as the first state nationwide to halt its fuel taxes following a dramatic spike in gas prices linked to Middle East warfare.

Governor Brian Kemp, a Republican, enacted legislation on Friday that pauses Georgia’s gas tax of 33 cents per gallon and diesel tax of 37 cents per gallon for a two-month period. Drivers should begin seeing savings at the pump within days as wholesale price reductions work their way down to retail stations.

However, this response differs significantly from the 2022 gas price crisis, as other states show little interest in implementing similar measures. The reluctance stems largely from states having less available cash than during the post-pandemic period, when federal assistance and tax collections both experienced dramatic increases.

According to AAA, the national average for gasoline has jumped from $2.93 per gallon on February 20 to $3.91 per gallon on Friday. This surge prompted Georgia officials to tap into the state’s dwindling reserve funds for two months of consumer relief, though rising oil costs could potentially offset these savings.

“Return taxpayer money where it belongs, in the pockets of hardworking Georgians,” Kemp stated.

State officials project Georgia will sacrifice between $360 million and $400 million in fuel tax revenue, providing drivers with approximately $5 to $6 in savings per fill-up for standard passenger cars.

Since these taxes fund transportation infrastructure, Georgia plans to use accumulated budget surpluses to cover road and bridge projects. The fuel tax suspension accompanies additional tax relief measures, including state income tax refunds ranging from $250 to $500 per household for residents who submitted Georgia tax returns in both 2024 and 2025. These $1.2 billion in refunds will also draw from state reserves.

This financial assistance arrives during an election year as both major parties compete for control of the battleground state of Georgia. Since 2021, Republican initiatives have distributed income tax refunds, property tax relief, and multiple gas tax suspensions totaling over $9 billion.

During the 2022 crisis, which was influenced by the Ukraine conflict among other factors, several states including Connecticut, Florida, Maryland and New York implemented gas tax relief alongside Georgia, while Illinois and Kentucky postponed planned tax increases.

However, Florida Governor Ron DeSantis announced Thursday that he will not suspend his state’s 23.5-cent gas tax, stating there is no “simple fix.” Speaking at a Bradenton press conference, the Republican governor explained his position.

“My answer is just get the cost down internationally, and that means having stable energy markets, making sure we’re doing everything to get our stuff to market,” DeSantis explained. “But I don’t know that there’s going to be any simple fix.”

While Maryland Republicans advocate for a 30-day tax holiday, the state’s Democratic leadership opposes the proposal.

“Marylanders need real relief, not a 30-day gas tax suspension that would blow a $100 million hole in our transportation budget while we’re working to close Maryland’s budget shortfall,” stated Ammar Moussa, spokesman for Democratic Governor Wes Moore. “If Maryland Republicans are serious about lowering costs, they should pick up the phone and call Donald Trump and tell him to end this missionless war — instead of asking Maryland taxpayers to help pay for it.”

Connecticut’s Democratic Governor Ned Lamont suggested a gas tax suspension earlier this month, though the proposal has yet to gain traction.

Georgia Republican leaders avoided referencing President Trump or the ongoing conflict, instead framing their action as part of their cost-of-living agenda while countering Democratic efforts to exploit public frustration over rising prices.

“This isn’t an issue that we just discovered,” Kemp explained. “It’s one we’ve been taking action on for years, in a strategic and carefully planned way, to help hardworking Georgians.”