Parson Signs Gas Tax Legislation

On Tuesday, July 13, Governor Mike Parson signed legislation into law that would incrementally increase the Missouri gas tax over five years. This is the first time Missouri has seen an increase in state gas tax since 1996.

With nearly $1 billion in unfunded transportation needs each year, we can no longer wait for another day or another generation - Governor Mike Parson

The new law will raise the tax on gasoline and diesel a small amount each year. The final tax level will be 29.5 cents in 2025. Included in this law is a provision for buyers to get a refund if they keep track of their receipts.

The current gas tax rate is 17 cents. The first increase will take effect in October and bring the rate to 19.5 cents.

Revenues from the gas tax are constitutionally required to go to maintaining and repairing Missouri’s roads and bridges. Once fully implemented, the law is projected to generate over $500 million annually for state, county and city roads.

MoDOT will use these funds to help cover the more than $8.25 billion funding gap for high priority annual transportation needs that have been identified over the next 10 years.

“With nearly $1 billion in unfunded transportation needs each year, we can no longer wait for another day or another generation. We must change course and address these problems head-on,” Governor Parson said. “SB 262 provides vital revenue that will help us fund essential road and bridge projects all across the state. Quality roads and bridges increase the efficiency and safety of our roadways, invite travelers and business investment, and save Missourians money.”

Missouri has the seventh largest transportation system in the nation but only ranks 45th in available revenue per road mile. Over the last 25 years, the state has been lax in increasing funding streams for projects, however costs have increased leaving Missouri infrastructure in a deteriorating state.

KPGZ News - Brian Watts contributed to this story