Gas prices did fall in 2022 after several states temporarily suspended fuel taxes, but the record is more precise than the broad claim suggests. Official state notices show Georgia, Maryland, Connecticut, New York and Florida each enacted tax holidays or temporary rate cuts that reduced what drivers were charged per gallon for limited periods.
Those breaks reached motorists at different times and in different amounts. Federal and state energy data show the larger national price swings that followed were also tied to crude oil markets, supply uncertainty after Russia’s full scale invasion of Ukraine, and later easing prices in wholesale fuel markets.
States cut fuel taxes as prices spiked
Georgia was the first state in 2022 to suspend its motor fuel excise tax. The Georgia Department of Revenue said Gov. Brian Kemp signed House Bill 304 on March 18, 2022, suspending the collection of the tax from 5:00 p.m. that day through May 31, 2022. Georgia later extended the break, and the Associated Press reported state gas tax collections resumed on January 11, 2023, after roughly 10 months. AP also reported Georgia’s tax was 33 cents per gallon on gas and 37 cents per gallon on diesel.
Maryland also acted on March 18, 2022. A state tax FAQ says the motor fuel tax free period began that day and ended April 16, 2022, at 11:59 p.m. Maryland’s consumer guidance said the state motor fuel tax was 36.1 cents per gallon for gasoline during that period.
Connecticut’s suspension started April 1, 2022. Gov. Ned Lamont’s office said the state suspended its 25 cent per gallon gasoline excise tax through June 30, 2022, then extended it through November 30, 2022, and later through December 31, 2022 with a phase in plan. New York suspended several fuel taxes from June 1 through December 31, 2022. Florida reduced its motor fuel tax by 25.3 cents per gallon from October 1 through October 31, 2022.
The direct local effect depended on the state. In Connecticut, emergency legislation said retailers that failed to reduce the per gallon price by the amount of the suspended tax could face an unfair or deceptive trade practice finding. New York’s tax department said suspended taxes had to be excluded from all sales of motor fuel and highway diesel motor fuel made during the suspension period, while counties and cities could make separate local sales tax choices.
In Maryland, the state told sellers that sales to qualifying motor fuel retailers and end users were prohibited from including the motor fuel tax in the fuel price during the holiday. In Florida, the Department of Revenue said the 25.3 cent reduction applied to motor fuel during October 2022, but not to diesel, aviation fuel or kerosene.
What remains harder to prove is the broader claim that states “quietly” suspended their fuel taxes and that those suspensions alone caused the wider drop in gas prices. The suspensions were publicly announced in governor statements, tax bulletins and agency guidance. And while drivers in those states got a defined tax break, the size of any additional savings beyond the tax cut itself was not uniform across every market in the sources reviewed.
The bigger context came from the energy market. The U.S. Energy Information Administration said Russia’s full scale invasion of Ukraine in late February 2022 contributed to rising crude oil prices and substantial uncertainty in petroleum markets. The agency also said U.S. gasoline prices vary by region because of supply, demand, fuel specifications and state taxes.
Later in the year, prices eased. AAA said on August 8, 2022, that gas prices had been steadily falling during the peak summer driving season and that the national average could drop below $4 that week. EIA later reported that although gasoline prices rose sharply in the middle of 2022, the U.S. average retail gasoline price ended the year 19 cents per gallon lower than in the first week of 2022.
The tax holidays ended on different schedules. Maryland’s ended in April 2022. New York and Connecticut resumed fuel tax collections on January 1, 2023, according to AP, and Georgia resumed on January 11, 2023. Florida’s holiday lasted one month. The confirmed record shows these state actions lowered taxes at the pump where they were enacted, but national gasoline prices moved on a much larger set of forces.