Pennsylvania Retroactively Reduces State Tax Rate for LNG
- Fuel Tax News
- Mar 9, 2015 | Gail Cole
The Pennsylvania state tax rate for liquefied natural gas (LNG) was increased, effective January 1, 2015. However, Governor Tom Wolf (D) recently has reversed the decision that led to that increase. Retroactively effective January 1, 2015, the rate for LNG is reduced by 4.3 cents per gallon, to 33.5 cents per gallon.
Gov. Wolf had this to say regarding the reversal:
“One of my goals is to promote and develop a comprehensive energy portfolio for Pennsylvania that supports clean energy alternatives to imported petroleum. Liquefied natural gas is not only a cleaner alternative to diesel, generating lower pollutant emissions when used to fuel vehicles, but it’s also produced here in Pennsylvania from abundant natural gas reserves…. [I]t makes no sense to discourage LNG consumption by taxing it at a higher rate.”
The state defines LNG as “an alternative fuel that should be taxed based on its energy potential as compared to gasoline.”
To put the tax rate for LNG in context, gasoline is taxed at a rate of 50.5 cents per gallon in Pennsylvania, and diesel is taxed at a rate of 64.2 cents per gallon.
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