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Beshear takes action to freeze Kentucky's gas tax

a person puts a gas pump into a white car
Engin Akyurt

On July 1, Kentucky’s gas tax would have increased from 26 cents to 28 cents, but Gov. Andy Beshear last week took action to freeze the current rate.

Beshear said Kentucky law allows for the increase, but said stopping it will help families save families money.

“But put simply, it's the right thing to do,” Beshear said. “While it is primarily out of our control as a state to decrease gas prices, this is a step that we can and we must take to prevent them from further increasing.”

Beshear said the suspended rate will save an estimated $35 million for Kentucky families.

According to 2021 Census estimates, Kentucky has about 1,748,053 households. That would amount to around $20 in savings per household.

He added that the move will also help local governments and businesses.

“Think about our fire departments, our EMS groups that are out there, our state fleet and the costs that we incur, this is going to help every Kentucky business in the logistics sector,” Beshear said.

The freeze is effective at least until January when the state legislative session begins and Beshear said lawmakers can decide what to do about the policy.

The state gas tax makes up about 1.6% of the Kentucky Transportation Cabinet’s total budget, Beshear said. “Which is healthier than it has been in a long time, including a 21% increase in the transportation infrastructure dollars from the federal government.”

Kentucky Transportation Cabinet Secretary Jim Gray said the freeze won’t impact operations or current road projects.

“We will continue with all of the projects that had been planned — that's roughly 1,500 projects across the state — that are in process today…in one stage of a level of planning or execution, implementation, actual construction,” Gray said.

Beshear said help for Kentuckians is still available through the Healthy at Home Eviction Relief Fund and Kentucky's Homeowner Assistance Fund. Kentucky Community Action Agencies also provide resources to all counties.