Gov. Katie Hobbs said she is open to pausing the state tax on gas.
“It’s a complicated issue, for sure,” the governor said in a media appearance last week.
“Every option is on the table, and when we go into budget negotiations, that’s something to consider,” she said.
As of Tuesday, fuel prices averaged $4.68 a gallon in Arizona, according to AAA.
That’s up from the $3.31 average a month ago. In Utah, fuel prices linger around $4.20 a gallon, higher than the national average of $4.02 per gallon. Californians are paying the highest price per gallon at $5.89.
This hike is in response to the war in Iran, which is in its fourth week. The Strait of Hormuz, a waterway for global oil trade, has been blocked amid this conflict.
EPA tries to stabilize prices
Although Hobbs pointed to budget negotiations for relief for consumers, she has vetoed the Republican-proposed funding packages twice, while her office called off budget negotiations on March 20.
“We’ve seen a lot of unserious attempts to push through tax cuts, not just for middle-class Arizonans who need it right now, but for billionaires and corporations, without any way to pay for it,” the Arizona governor said.
She pointed to her proposal, unveiled in January, and added that it includes tax cuts for the middle class.
Hobbs said she appreciated the Environmental Protection Agency for issuing a temporary fuel waiver, allowing E15, gasoline mixed with 15% ethanol, to be sold nationwide while removing all federal barriers for E10, gasoline mixed with 10% ethanol. The EPA did this to strengthen the domestic fuel supply and offer consumers relief at the gas pumps over the summer.
“Gas goes up in the summer because the summer blend is more expensive and I am grateful that the federal government is waiving that,” Hobbs said.
Arizona primary uses E10 during the summer, while E15 is restricted because it contributes to smog formation during high-heat months.
Would Hobbs’ plan work?
Hobbs, in the past, has supported higher gas taxes. In 2018, Hobbs, serving as the Senate minority leader, sponsored a bill that would raise this tax from 18 cents to 36 cents a gallon.
Arizona has enjoyed the lowest gas tax in the U.S., at 18 to 19 cents a gallon, compared to California’s more than 90 cents a gallon.
AAA Auto Club Group spokesperson Skyler McKinley told The Center Square last week that he cautioned against suggesting that prices will stabilize, given the complicated and dynamic nature of the international conflict in the Middle East.
“There’s some stuff you can do around the margins. And when we have gas tax conversations, that’s what we’re talking about — but changing those doesn’t actually change the trend lines and the pressures (on fuel prices),” said McKinley.
“A gas tax is a simple fix to provide some measure of relief to some people, but it does so at the consequence of whatever you would use those dollars for.”