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States Expecting 30 Percent Drop in Fuel Tax Receipts

Posted on Mar. 30, 2020

States are anticipating a 30 percent reduction in transportation revenue from a decrease in fuel tax receipts because of the impact of the COVID-19 pandemic.

Speaking during a March 27 National Governors Association webinar, Susan Howard of the American Association of State Highway and Transportation Officials said the estimates are based on data from the last recession. She said there was a large decline in vehicle miles traveled across the United States in 2007, the beginning of the recession. State transportation revenues didn't recover until March 2013. 

“There is much less driving going on, much less gasoline being purchased. That translates to a significant drop in the revenue that states are able to apply to their transportation projects,” Howard explained.

Howard said she expects there will be more and better data available in the coming weeks.

“The question I think that we’re all thinking and wondering is how long [the pandemic-induced economic slowdown] may last, and I think we’re all thinking it may last a long time,” Howard said. “States are going to have to make some decisions in terms of what projects they can continue to fund with the resources that they have and what kind of federal assistance might be needed in the future.”

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