2020 House Bill 5582

Repeal sales tax on fuel; raise gas tax; “backfill” school revenue with income tax

Introduced in the House

March 5, 2020

Introduced by Rep. Shane Hernandez (R-83)

To exempt motor fuel for cars, trucks and aircraft from sales tax, gradually reducing the sales tax imposed on fuel from 6% to 4% on Oct. 1, 2020, and 2% a year later, and zero on Oct. 1, 2022. House Bill 5585 would increase the state motor fuel tax by an equivalent amount. Michigan sales tax revenue is allocated to schools and general state spending, not transportation; House Bill 5586 would replace the revenue this levy raises for schools by transferring to the state school aid fund an equivalent amount of income tax and other state general fund revenue.

Referred to the Committee on Appropriations