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Press Release


Ehrlich Should Heed Maryland Officials' Calls to Suspend State Gas Tax, Citizen Group Says

For Immediate Release September 9, 2005

(Alexandria, VA) -- Governor Bob Ehrlich should take the advice of Maryland Congressman Al Wynn and work with the State Legislature toward a moratorium on fuel taxes, according to an open letter sent to Ehrlich today from the 400,000-member National Taxpayers Union (NTU). The non-partisan citizen group has nearly 8,500 members in Maryland.

"Given the ongoing price spikes associated with supply disruptions caused by Hurricane Katrina and record-setting gas costs that have been plaguing motorists for much of 2005, now is the time to use surplus state revenues generated in recent years by strong economic growth to cushion the blow," NTU Government Affairs manager Kristina Rasmussen wrote to Ehrlich.

Rasmussen noted that a reduction or suspension of Maryland's 23.5 cent-per-gallon fuel tax is "the only taxpayer-friendly solution to gas-price woes," and warned elected officials against pursuing "discredited Nixon-era bromides" such as government-imposed price caps.

Though Ehrlich has expressed no plans to seek a gas tax holiday amid what he sees as tentative signs of stabilizing prices and supplies, Rasmussen contends that he still has numerous reasons to take action now rather than wait for a new escalation in the crisis. Noting that the state "holds the dubious honor of having the 16th-highest state [per-gallon] gas tax in the nation," Rasmussen calculated that a Maryland motorist currently faces an "oppressive" federal-state tax bill of $6.29 on a typical fill-up. In addition, the state is sitting on a $1.2 billion budget reserve, more than enough to absorb any "lost" revenues and allow the state to continue paying off road-project loans (one of Ehrlich's stated concerns).

Last week Georgia's Sonny Perdue became the latest Governor to temporarily suspend by Executive Order the state's taxes on gasoline (Illinois' and Indiana's chief executives did so in 2000). Maryland's Governor could possibly take such action by declaring an emergency, but could also call the Legislature back into session to consider a relief package.

"Although using budget reserves to fund new spending programs may be tempting, lowering state gas taxes immediately is a better way to assist Marylanders as all taxpayers and aspects of your state's economy are affected by rising gas prices," Rasmussen concluded in her letter to the Governor. "Your active leadership would ensure that beleaguered Maryland motorists can better cope with this trying time."

NTU is a non-profit organization working for lower taxes, smaller government, and greater economic freedom at all levels. Note: Rasmussen's letter to Ehrlich, along with numerous studies and commentaries on transportation policy, may be accessed online at www.ntu.org.

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