Bill > HB4183

This bill amends Michigan's motor fuel tax law by establishing a new mechanism for calculating annual motor fuel tax rates, with provisions that gradually increase tax rates based on inflation. Specifically, the bill sets initial tax rates at 26.3 cents per gallon for both gasoline and diesel fuel, and then creates a formula for annual adjustments beginning January 1, 2022, where the tax rate will be calculated by multiplying the previous year's rate by 1 plus the lesser of 5% or the inflation rate, rounded up to the nearest tenth of a cent. Starting January 1, 2026, the base calculation will use 51 cents per gallon as the starting point. The bill also includes detailed provisions for tracking and taxing motor fuel, requiring suppliers to collect and remit taxes, and mandating specific reporting requirements for fuel transactions. Additionally, the bill imposes a tax on motor fuel held in storage above 3,000 gallons as of December 31, 2025, with specific reporting and payment deadlines. Importantly, the bill will only take effect if several related legislative bills are also enacted, signaling it is part of a broader transportation funding package. The primary intent is to ensure that motor vehicle users pay for the privilege of using public roads and highways through a consistently adjusted fuel tax mechanism.

Budget and Finance, Transportation and Infrastructure

https://legislature.mi.gov/Bills/Bill?ObjectName=2025-HB-4183