Sefzik FUEL Act slashes gas prices — uses $8B surplus to suspend gas tax, give working families a break

OLYMPIA – Washington would get a year-long reprieve from state fuel taxes under a bill sponsored by Sen. Simon Sefzik, R-Ferndale – worth $1.3 billion, or an average $221 for every licensed driver in the state.

Senate Bill 5897 would suspend the state gas tax through the end of 2022, immediately reducing the price of gasoline and diesel fuel in Washington state by 49.4 cents a gallon.
Instead, transportation spending would be funded by the state’s fast-growing surplus – nearly $8 billion at present, and likely to grow.

“The state has so much money right now that the Legislature probably would have trouble spending it all,” Sefzik said. “Well, I’m saying we shouldn’t. We should give some of it back to the taxpayers, in the form of lower gas prices, at a time when it could really make a difference.”

Sefzik’s bill is dubbed the “FUEL Act,” short for “Fighting Unaffordable Energy Laws.” It would temporarily suspend Washington’s gas tax, currently the eighth highest in the country, according to the American Petroleum Institute. And it would transfer $1.3 billion from the general fund to the state transportation account, providing continued funding for highway projects and other transportation needs. The bill is written to ensure fuel-tax savings are passed on to the consumer.

The proposal comes as gasoline prices in Washington state approach historic highs. In the last 12 months, the average price of gas in Washington state has gone from $2.82 to $4, a 42 percent increase. Washington residents are currently paying the third-highest gas prices in the nation, according to the American Automobile Association, trailing only California and Hawaii.

“I’m sure every consumer in Washington state would appreciate a respite from high gas prices,” Sefzik said. “But this would be especially meaningful for those at lower income levels. Few household expenses are more regressive than gasoline. When the price increases, low-income households face a greater burden than the wealthy, because they must spend a higher percentage of their income just trying to keep up.

“By suspending the gas tax, we can make a big difference for working families across the state.”

Since the Legislature adjourned its last session in April 2021, Washington business activity has increased. New projections of state tax collections are up $8 billion so far, and the upward trend continues. The current forecast counts on about $2 billion from a controversial new income tax, passed by Democratic lawmakers last year when they declared a financial emergency that never materialized. That tax could be overturned by the courts or the voters. But the remaining $6 billion offers more than enough to eliminate the gas tax for the year, Sefzik said.

“There are few things we could do that would be more meaningful for the people of Washington state than bringing gas prices down to a more affordable level,” Sefzik said.

Actual individual savings would vary according to the amount of fuel purchased. Average savings figures per registered driver reflect both individual and commercial consumption in Washington state. Washington currently has 5.86 million registered drivers, according to the Department of Licensing.