Wednesday, June 6, 2007

Waiting for gas prices to drop...

Come July 1, consumers should be looking at a 14-cent drop in gas prices, not the 10-cents discussed while the legislature was in session.

The legislature passed HB1757 which exempts the sale of alcohol fuels, including ethanol -blended gasoline, from the general excise tax at 4.5%. The bill requires that the tax savings be passed on to the consumer. Now that gas prices have risen to over $3.00 per gallon, $3.00 X 4.5% = 13.5 cents. The bill also increases the fuel tax by 1 cent per gallon.

Today, a quick look around Honolulu puts gas prices about $3.30 per gallon. At this price, if the bill were to become law, the cost savings to consumers would be around 13.8 cents. ($3.30 X4.5% = 14.85 cents - 1 cent).

However, as of this date, the Governor has not signed the bill into law.

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