Governor calls for continued gas tax suspension

8-cent increase goes back into effect today

Posted: Tuesday, September 01, 2009

ANCHORAGE - Gov. Sean Parnell pumped $65.23 worth of gas into his Ford-150 truck on Monday while calling for an extension in the suspension of an 8-cent-per gallon tax increase.

"This is going to be costly I think. Actually, not as costly as tomorrow," the governor said after stepping from his truck at a Tesoro gas station in midtown Anchorage.

The fuel tax increase has been suspended for one year but goes back into effect today.

If Parnell had bought gas after the 8-cent a gallon hike, it would have cost him about $1.60 more to fill up his black, 9-year-old truck.

Regular unleaded gasoline was selling Monday for $3.19 a gallon at the Tesoro station.

The governor said his wife also was filling up her car on Monday before the price went up.

Parnell 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.

The one-year suspension cost the state $40 million to $45 million, according to state Revenue Commissioner Pat Galvin.

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.

Parnell denied that his move - bound to be popular with Alaskans routinely faced with paying the highest gasoline prices in the nation - has anything to do with his intention to run for governor in 2010. He took office in late July upon the mid-term resignation of Sarah Palin.

Extending the suspension is the right thing to do, he said.

"I'm interested in giving Alaskans a break at the pump," Parnell said.

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 dealing not only with high transportation fuel costs but the escalating cost of home heating fuel.

Parnell said even though lawmakers refused to consider the idea during the special session, he looks 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.

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