On Friday, October 1, Missouri’s gas tax will increase for the first time in 25 years, but Missourians who don’t want to pay the increase have an option.
The tax will increase by 2.5 cents October first, with more incremental increases every July 1 until it reaches a 12.5 total increase in 2025. The Department of Transportation estimates the increase, when fully implemented, will generate another $460-million annually for the state’s roads and bridges.
Those who don’t want to pay the increase will be able to apply for a refund. The Department of Revenue has prepared a draft of the form that would be used, which can be viewed here. A final version is expected to be available, either digitally or by paper copy, by the time applications can be accepted between July 1 and September 30 of next year.
Fuel purchased in Missouri for vehicles weighing less than 26,000 pounds is eligible for a refund. House Transportation Committee Chairwoman Becky Ruth (R-Festus) said Missourians who want a refund will, “need to save [fuel] receipts in case they are audited, and there is a form that the Department of Revenue is providing for them to fill out,” said Ruth.
Ruth said she’s not concerned that letting people get back some of their tax dollars will hurt the overall goal, that of giving the Department of Transportation more funding to maintain the state’s roads and bridges.
“I think this is a very fair provision. If people are happy with the job that’s being one and they want to continue to invest in the roads and bridges, then they will leave their money there. If they feel like they need to have that money back; they don’t think it’s fair, they need it for whatever reason, or maybe they’re just not happy with how the money is being spent or they don’t feel like MODOT’s doing a good job, they can request a refund of that new tax.”
Ruth said the initial increase, which begins October 1, has been estimated at about $1 a month for the average Missouri driver.
Ruth said the Department has been running about $800-million behind what it needs for road work, per year. The increase will cover a significant portion of that gap, and will also put Missouri in position to draw federal dollars from an anticipated infrastructure bill.
“That federal infrastructure bill is an 80/20 match. Otherwise we would not be in a position to have the match money to pull down those federal dollars … we’re talking about billions. Roughly, Missouri is looking around $7-billion. If we did not have this money to pull down that match, that money would end up going to other states.”
Ruth said she was grateful for the bipartisan support this proposal received. She thinks that is due, in part, to the refund provision, and to lawmakers recognizing a need for additional money for transportation.
“I just look forward to seeing Missouri rise in terms of where we’re at in road funding: having safer roads to travel on, roads that are in better condition. Our investment in our infrastructure also helps to drive the economy and bring in new business,” said Ruth.
The gas tax increase became law when Governor Mike Parson (R) signed Senate Bill 262, which passed out the House with a final vote of 104-52.