NASHVILLE, Tenn. (AP/CLARKSVILLENOW) – Republican Gov. Bill Haslam is proposing to raise Tennessee’s tax on each gallon of gasoline by 7 cents while cutting the state’s sales tax on groceries and income from earnings on stocks and bonds.
Haslam says average motorists would pay an extra $4 dollars more per month as part of his plan to generate $278 million annually in new money to pay for road projects around the state.
The governor says he would balance the gas tax increase with proposed cuts of $55 million in the sales tax on groceries, $113 million in corporate taxes for manufacturing companies and $102 million in the Hall tax on investment income.
Haslam also wants to tie the gas tax to inflation and let cities seek a sales tax surcharge to pay for transit projects.
Other politicians responded to the announcement.
“I am pleased to know Gov. Haslam will propose a long-awaited funding package to address our growing infrastructure needs,” Rep. Joe Pitts (House District 67) said. “The reduction in sales and Franchise & Excise taxes are certainly noteworthy and deserve deliberation, as does the local option, via referendum, gas tax idea. The ‘user fee’ increase, or increasing our gas and diesel taxes, merit a lot of study and I am hopeful we will get that done this session. I need details about the tax increases, and especially some firm commitment that if a tax increase is approved, Clarksville-Montgomery County will get some much needed relief in our traffic congestion by way of road improvements. I have not heard much about mass transit funding which is a critical regional need in Middle Tennessee.”
Nashville Mayor Megan Barry is lauding Republican Gov. Bill Haslam’s proposal to allow cities to hold referendums on adding a sales tax surcharge to pay for mass transit projects.
Officials in the booming Nashville region have identified $6 billion in transit needs over the next 25 years.
Barry says she believes people in Nashville “are willing to pay for a mass transit system that meets the needs of our growing community.”
Copyright 2017 The Associated Press.