Raleigh — North Carolina lawmakers on Wednesday approved legislation to suspend the state motor fuels tax through the end of November and sent the measure to Gov. Josh Stein for review. The pause would suspend the state’s 41-cent-per-gallon tax and is projected to cost roughly $360 million, according to lawmakers, though the final figure depends on when the suspension takes effect.
Votes, cost and timing
The House approved the bill 111-1, and the Senate passed it 41-0. Supporters said the pause offers immediate relief to motorists while critics argued the move is politically timed just before the midterm elections.
| Measure | Figure |
|---|---|
| State gas tax | 41 cents per gallon |
| Estimated cost to state | $360 million (approx.) |
| Potential NCDOT shortfall (30-day pause) | $225 million (preliminary estimate) |
Impact on transportation funding
The North Carolina Department of Transportation warned the gas tax accounts for about 40% of state-generated transportation revenue. In a statement, the department said it was monitoring the discussion and that a 30-day pause could create about $225 million in lost revenue for NCDOT.
“NCDOT is aware and monitoring discussions on suspending the state’s motor fuels tax,” the statement said.
Republican lawmakers backing the bill said transfers from the state’s inflation reserve could be used to replace lost transportation revenue. The bill would tap state savings to cover the suspension’s cost rather than cutting existing program budgets now, lawmakers said.
Political debate and consumer effect
Lawmakers acknowledged that gas stations may not immediately pass the full savings to customers, and pump prices likely would not fall by a full 41 cents per gallon. Democrats criticized the timing, saying the relief could have been considered earlier rather than weeks before voters head to the polls.
- Supporters say the measure provides short-term relief to consumers facing high pump prices.
- Opponents call the suspension politically motivated and argue it imperils funding for roads and bridges.
- Even if signed, it may take time for retail prices to reflect the tax pause.
Sen. [Barnes] described the measure as providing “immediate relief” amid ongoing challenges, while Rep. Butler said he supported the relief but criticized its timing as “too little, too late.” Gov. Stein has not yet indicated whether he will sign the bill; his office said he would review the measure.
The bill passed during a special session as average regular gas prices statewide remained above $4 per gallon, a key factor cited by lawmakers pushing for the pause. If the governor signs the measure, state budget writers and NCDOT officials will need to outline how to cover the suspension’s impact on transportation projects and cash flow.
The outcome will determine how quickly motorists at the pump see any relief and how the state balances short-term assistance with sustaining long-term infrastructure funding.
