Alaska's Gas Tax Increase in Effect

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Alaska's Gas Tax Increase in Effect

ANCHORAGE, Alaska -- After a yearlong suspension, the state’s 8-cent per gallon gas tax increase went back into effect yesterday, The Associated Press reported.

Alaska Governor Sean Parnell pumped $65.23 worth of gas into his Ford-150 truck Monday while calling for an extension in the suspension of the gas tax increase. If Parnell bought gas after the 8-cent a gallon hike, it would have cost him roughly $1.60 more to fill up his nine-year-old truck, the AP report stated.

Parnell, who took office in late July upon the mid-term resignation of Sarah Palin, said he will ask lawmakers to extend the fuel tax increase suspension when they reconvene in January. Lawmakers declined to bring up the issue during a one-day special session in early August. Parnell said in this economy, Alaskans need help at the pump.

"I think Alaskans are stranded by this economy, and they need a break," he said.

The one-year suspension cost the state $40 million to $45 million, according to state Revenue Commissioner Pat Galvin. The tax increase applies to gasoline, diesel, marine fuel and aviation fuel. The tax was suspended in 2008 as part of an energy assistance bill supported by Palin to help Alaskans deal not only with high transportation fuel costs but the escalating cost of home heating fuel, according to the AP report.

Parnell said even though lawmakers refused to consider the idea during the special session, he is looking forward to working with them in January on a new proposal, either in the form of his own bill or someone else's. "We will work through it," he said.