ST. PAUL, Minn. (AP) – Minnesota Senate Democrats are proposing a new sales tax on gas at the wholesale level as a way to raise money for road and bridge projects.
Senator Scott Dibble is rolling out his revised transportation budget Wednesday. Last week, the Minneapolis Democrat yanked a direct gas tax increase in the face of opposition from Gov. Mark Dayton.
Dibble’s new proposal actually cuts the state’s 28.5-cents-a-gallon gas tax by 6 cents a gallon. But he replaces it with the 5.5-percent tax that oil companies would pay at the wholesale level. He says that would net the state an additional $200 million a year for roads and bridges.
Dibble says drivers might still end up covering some of that tax hike at the pump. But he says it’s a way to shift the direct burden of the increase away from consumers.