‘holiday' sputters

By The Associated Press

ALBANY - Republicans in the New York Senate and Assembly say cutting the local, state and federal taxes on gasoline could save up to $10 per fill-up during their proposed “summer holiday” from gas taxes.

But many political and economic obstacles stand in the way of the election-year proposal.

Democratic Gov. David Paterson says he won't reject the push by Senate Republican leader Joseph Bruno and Assembly Republican leader James Tedisco. But he says there's no guarantee gasoline suppliers and retailers wouldn't simply jack up the price even if the taxes are eliminated over the summer.

Paterson also questioned if the state can afford the loss of millions of dollars in revenue after years of spending too much and in the face of historic deficits.

Paterson said it's a “leap of faith” that prices at the pump would be cut by the amount of the taxes without some pledge by the industry.

“This is something we could legislate, but not implement,” he said. He also said the state can't afford the revenue loss if there no guaranteed cut in gas prices because he predicts state deficits of up to $20 billion over the next three years.

But Bruno said the cut in the state, local and federal tax - or even just cutting the state tax - would likely pay for itself. He said New Yorkers would have more money to spend on groceries and clothes and that the cut could entice more tourism.

He said a summer without gas taxes could save $7.20 to fill-up a car or $10 to fill-up a sport utility vehicle or truck. Gas prices are expected to hit $4 a gallon and more this summer.

“That's the objective here, to stimulate the economy,” Bruno said.

The state tax is 32.8 cents per gallon, the federal tax is 18.4 cents and the local tax is 13.9 cents. If all taxes were suspended from Memorial Day to Labor Day, New Yorkers would see about a 65-cent cut in price to $3.93 per gallon, instead of $4.58 per gallon, said Bruno, a Rensselaer County Republican.

“High gas prices have a negative multiplier effect, driving up the cost of everyday goods,” said Tedisco, a Schenectady Republican. “The fastest way to put the brakes on rising fuel, food and other commodity costs is by instituting a much-needed holiday from the state fuel taxes for motorists and businesses.”

Democratic Assembly Speaker Sheldon Silver said the “Republicans are trying to hide from the failures of the Bush administration.”

“I believe that oil companies will simply raise their prices to eliminate any cost savings,” Silver said. He said the Republicans should call the Bush administration and demand action to solve the problem.