ST. PAUL, MN – House Democrats approved Monday their Transportation bill (HF 1555) which increases the gas tax by 20 cents per gallon – a 70-percent increase – and in total raises taxes by more than $4 billion over four years. The bill passed on a 74-58 vote despite bipartisan opposition.
“Those of us who live along Highway 12 understand we need to improve our roads and bridges in Minnesota,” said Rep. Joe McDonald, R-Delano. “The problem is House Democrats and Gov. Tim Walz want to accomplish this by raising a tax that hurts low- and middle-income earners and the people of Greater Minnesota the most. A 70-percent increase would make our state’s gas tax among the nation’s highest and also likely would drive up the costs of virtually all other goods and services. With a $1 billion surplus, there is no reason to raise a tax that will disproportionately burden people who can least afford it.”
In addition to the increase of 20 cents per gallon – which would give Minnesota the fourth-highest gas tax in the country – the House Democrats’ transportation bill increases the vehicle registration tax, the metro sales tax, and the new vehicle sales tax will increase taxes on Minnesotans by a combined $2.3 billion.
The bill also transfers statutorily dedicated auto parts sales tax funds – $417 million in 2020-21 – into the general fund. This reverses the major investments House and Senate Republicans made during the last biennium to fund road and bridge infrastructure without a gas tax increase.