Alabama Gov. Kay Ivey has proposed a 10-cent increase to the state’s fuel tax as part of her Rebuild Alabama Infrastructure Plan to generate money for transportation projects.
Ivey announced the infrastructure plan at a news conference Feb. 27 alongside a group of legislators and local government officials. The proposed 10-cent tax hike would be indexed to keep up with the rising cost of rebuilding roads.
The current excise tax rate is 19 cents per gallon for diesel and 18 cents per gallon for gasoline. The revenue created from these taxes creates 80% of Alabama’s transportation funding.
The revenue created through the proposed fuel tax increase will be split among state, county and municipal government agencies for infrastructure improvement and maintenance projects.