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Missouri gas tax increase could be left up to voters if new referendum is successful

The Secretary of State’s Office is now accepting comments on a referendum petition filed to place the recently-passed gas tax hike before voters before it can be implemented. 

Jeremy Cady, state director of Americans For Prosperity-Missouri (AFP) filed the referendum petition with the Secretary of State’s Office Friday seeking to put the recently-passed legislation gradually increasing the state’s gas tax to a vote of the people. The petition suggests placing the proposal on the Nov. 8, 2022 ballot — more than a year after the first increase would take place. 

From Senate President Pro Tem Dave Schatz, the legislation would increase Missouri’s fuel tax by 2.5 cents annually beginning in October — bumping it up to 29.5 cents from 17 cents by 2025. The funds would go toward fixing the state’s roads and bridges and includes a rebate option for drivers. The Senate bill was approved by the General Assembly during the final week of session and awaits action by the governor. 

By the time it’s fully implemented, the tax increase would generate more than $513 million before refunds, according to an estimate from the Department of Revenue. 

Cady told The Missouri Times the phased-in approach to the bill allowed it to circumvent the Hancock Amendment which requires voters to approve tax increases over a certain amount. 

“I don’t think sidestepping the Hancock Amendment is appropriate,” Cady said. 

As the bill stands, the first 2.5 cents hike would occur in October 2021. But if AFP, a fiscally conservative advocacy group, can get the petition approved and garner enough signatures, the implementation would be delayed pending voter approval. 

The Secretary of State’s Office on Monday announced the referendum petition is open for public comment for 15 days. The office will then have 23 days after the petition is approved to create ballot summary language.

Schatz’s SB 262 had support from the Missouri Farm Bureau, whose president called it a “concrete step to boost funding for roads and bridges.” 

“The new funds will be divided among state, county, and local roads,” President Garrett Hawkins said. “This is great news for rural Missouri and the important farm-to-market roads that carry farm products as well as the roads we all use every day to get our kids to school and to drive to work.” 

But conservative Sen. Rick Brattin argued the increase would be detrimental to some Missourians’ budgets. He argued in a recent column the state already has enough money to fix roads and bridges without a tax increase if allocated properly. 

The last time the Missouri Legislature approved a gas tax increase was in 1992 when it phased in a 6-cent increase over the course of five years with the final 2-cent hike occurring in 1996.