
"Yes,
the way Michigan taxes gas is changing, and it will involve an increase in the motor fuel tax rate as part of a larger plan.
Here are the
key changes and their effective dates, based on the recent legislation:
- Motor Fuel Tax Increase: The per-gallon motor fuel tax rate is set to increase from the current $0.31 per gallon to $0.51 per gallon (a 20-cent increase).
- Sales Tax Elimination: The state's 6% sales tax on gasoline, diesel, and aviation fuel will be eliminated starting January 1, 2026.
- Net Effect: This change is designed to be revenue-neutral for drivers at the pump, meaning the total tax paid per gallon should remain roughly the same as the increase in the fuel tax is intended to offset the removal of the sales tax [3.3]. The goal is to direct all of the money collected at the pump to road and infrastructure funding, which wasn't the case with the sales tax revenue.
- Effective Date: The new system, including the increase in the motor fuel tax and the elimination of the sales tax, is slated to take effect on January 1, 2026.
The current motor fuel tax rate is $0.31 per gallon, which is also subject to an annual inflation adjustment
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