Justice: Gas Tax Holiday ‘Dead On Arrival’
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CHARLESTON - Despite saying earlier this week he was giving the idea reconsideration, Gov. Jim Justice said Wednesday a 30-day gas tax holiday isn’t possible with no interest from Republican legislative leaders.
“It’s completely dead,” Justice said Wednesday morning during a virtual briefing at the State Capitol. “A lot of people are questioning me why I’m not moving on this, and I really felt strongly it would be a waste of time. But we’ve heard from the majority ... and they do not have an interest.”
During Monday’s COVID-19 virtual briefing, Justice said he was giving some thought to reconsidering a 30-day freeze of the state’s 35.7-cent-per-gallon gasoline tax. Democratic lawmakers first asked Justice to consider a gas tax holiday in March, which Justice dismissed as a “publicity stunt.”
Justice said Monday he would present a possible plan for a gas tax holiday Wednesday during his second briefing, but through private conversations with Republican lawmakers and an appearance by Senate President Craig Blair, R-Berkeley, on WV MetroNews Tuesday saying there was no support for a gas tax holiday, Justice said it would make no senses to call lawmakers into a special session to pass a gas tax holiday.
“From the standpoint of now, calling a special session in regard to a gas tax holiday, it’s absolutely going to be two things: a total waste of time, and on top of that it will cost the taxpayers money,” Justice said. “It’s dead, it’s gone. That’s all there is to it.”
Justice also cautioned against either reducing or eliminating the gas tax. The $1.9 trillion American Rescue Plan Act includes a provision that prohibits states that receive ARPA dollars from directly or indirectly offsetting net tax revenue by reducing or delaying tax collections. West Virginia received the second tranche of its $1.35 billion ARPA allotment last month, and was approved this week to receive an additional $136 million for broadband expansion.
“I love the fact that we’re reducing taxes. I love that in every way,” Justice said. “But whatever we do, we cannot break the law so there is a claw back...that can cause us all kinds of issues that would absolutely really hurt us.”
However, there are at least two federal stays blocking enforcement of the ARPA tax cut provision by the U.S. Treasury Department. One of those cases was brought last year by state Attorney General Patrick Morrisey. The District Court for the Northern District of Alabama Western Division granted a motion for final judgment and permanent injunction blocking enforcement by the U.S. Treasury Department of the ARPA tax cut provision.
Justice also raised concerns about doing anything that might grow the size of the state’s general revenue budget, requiring new expenditures every year.
“If we add to the budget in anticipation that the dollars are going to be there or the hopes that we’re going to grow, then all of a sudden things turn a little bit bad ... we’ve got to be cautious,” Justice said. “If things were to turn in not the way we want them to turn, we’d be left there holding the bag and we’d have to start all over.”
The state collected $5.2 billion in tax revenue for the final 11 months of fiscal year 2022 as of the end of May, 26.9 percent more than the $4.1 billion revenue estimate from the state Department of Revenue, resulting in a $1.1 billion surplus fiscal year-to-date. The approved budget for fiscal year 2023 beginning Friday, July 1, is $4.635 billion, along with $793.4 million worth of items to be funded out of surplus tax dollars available at the end of June.
Justice said while he was willing to reconsider a gas tax holiday given the continued increase in gas prices over the last five months, he personally was not supportive of the idea, laying the blame on President Joe Biden for his actions on climate change and inflation.
“I don’t know where this nation is going,” Justice said. “I know we should absolutely have total energy independence in this country. Right off the get-go, Biden - driven by these left-wing nut jobs - came out and tried to stab West Virginia right in the heart and say we don’t need gas and we don’t need coal...that message rippled across the entire globe.”
Democratic lawmakers held a press conference Tuesday calling on Justice to either call a special session for a gas tax holiday or to use his powers under the current COVID-19 state of emergency to pause the gas tax.
“Why is it that Republicans in Maryland and Republicans in Georgia have found the way to suspend their gas tax, yet Republican leadership in West Virginia hasn’t done so? Only Democratic leadership and Democratic members have stepped up and said we should be doing this,” said House Minority Whip Shawn Fluharty, D-Ohio, during Tuesday’s press conference. “Other states are doing it in a bipartisan manner. They’ve managed to figure it out. And yet here we are, months down the road and nothing.”
“There’s no point in you calling me,” Justice said in closing Wednesday. “We know now where the majority stands, and the majority says they’re not interested. To be perfectly honest, I wasn’t interested before in the first place. The last thing you need to do is associate me with some Democrats who stand up on a soapbox ... I’d be open to anything that anybody would come up with to help our people, but this situation is dead on arriv