Possible Gas Tax Increase Concerns Station Owners

FREDERICKMD - A proposal to increase Maryland's gas tax is gaining traction in Annapolis and leaving many gas station owners worried about the cost of doing business.

Customers could wind up shelling out more money at the pump.

Governor Martin O'Malley's proposal to raise the sales tax on gasoline passed in the House Waysand Means Committee on Monday.

"The gas tax that's being proposed now would affect us immensely because what would happen is not only would the costs of taxes go up but the cost of doing business would also go up for us through the credit card fees, which theoretically would have to be passed onto the consumer," says Dave Beal, owner of the Rosemont Gas Station.

Beal went to Annapolis last Friday to show his opposition to raising the tax.

The house committee approved the bill to raise the wholesale price of gas by one percent on July 1st and two percent in 2015, but Frederick Shell owner Joe Parsley believes it's not that simple.

"The indexing of the gas tax at the wholesale level will still impact my customers and myself the same way a per gallon gas tax would," Parsley says. "The indexing does not stop at two percent in July 2015. It continues to go up, and it will never go down."

Beal and Parsley fear many customers won't fill up in Maryland if the gas tax does increase, since the state is so close to PennsylvaniaWest Virginia and Virginia.

"Many of the people here would say it's easier for me to go there to get my gas," Beal says. "It's less expensive, it costs me less and it's not that far for me to drive to save that amount of money."

"It will disproportionately affect the lower income wage earners who have to drive older cars that get worse gas mileage, while the people who can afford new cars end up getting the road tax subsidized by the poorer person," Parsley says.

The Maryland House of Delegates will debate the bill as early as this week. It could add three to four cents a gallon to the price of gas this summer if the house gives the bill the green light.

The governor believes the gas tax increase is necessary to raise money for transportation projects.

Maryland's gas tax hasn't been increased since 1992.The Virginia legislature is considering lowering the gas tax in the state.

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