Aviation Fuel Bills Pass the House, Local Revenue Protected

Posted on December 9, 2013 by Dene Westbrook

The Michigan House of Representative passed three pieces of legislation changing the way aviation fuel tax is collected. The Michigan Municipal League advocated that local communities revenue not be impacted by this change and that protection of their funding remain tied to the constitution and not an appropriation. Under the House passed version local revenue has been protected

HB4571, sponsored by Rep. Wayne Schmidt (R-Traverse City), would change the current excise tax on aviation fuel from 3 cents per gallon to 2 percent of the average wholesale price on each gallon. The change would allow the tax to fluctuate with the price of fuel.

HB 4572, also sponsored by Schmidt, exempts aviation fuel from one-third of the sales tax. It will still be subject to 4% sales tax under the constitution protecting revenue that is shared with local communities

HB 4677, sponsored by Rep. Phil Potvin (R-Cadillac), would backfill money that the School Aid Fund would lose, by shifting some sales tax revenue from the General Fund to the School Aid Fund.

John LaMacchia is a Legislative Associate for the League handling transportation and infrastructure issues. He can be reached at [email protected] or 517-908-0303.

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