Cayuga County legislators want to hear from town and village officials before deciding whether to approve a gas tax cap.
The Citizen reports lawmakers want to find out what local officials think of the potential loss of tax revenue a cap would bring. County Finance Director Mary Beth Leeson explained the implications of a cap to legislators, saying if it were adopted, gas would be taxed on a cents-per-gallon basis up to the cap, rather than as a percentage of the entire sale. The current county tax is four percent.
25 counties have imposed caps, including four that border Cayuga; Onondaga, Oswego, Seneca, and Wayne. Seneca and Wayne capped their tax at two dollars per gallon, while Onondaga and Oswego chose three dollars per gallon.
Even with a cap, sales tax revenue is expected to go up this year
The earliest a cap could take effect would be September 1. There is no mechanism to guarantee that the savings would be passed on to customers. Leeson told lawmakers a two-dollar per gallon cap would cost the county $435,000. The allocation to towns and villages would also decrease by $217,500. Leeson points out that the county still expects a healthy increase in sales tax revenue overall in 2022. The legislature must pass a cap by the end of July for it to take effect on September 1. Lawmakers could choose to have the cap expire on November 30, the end of the fiscal quarter, or at the end of the year.