Utah gas, property taxes to get first hikes in nearly 20 years

Monday , March 30, 2015 - 11:26 AM

The Associated Press

SALT LAKE CITY — Gas bills and property taxes are set to tick up in Utah after Gov. Gary Herbert signed off on pair of tax increases that are state’s biggest in nearly 20 years.

The gas tax will increase by 5 cents a gallon in July, and in November the average homeowner will pay about $50 more in property taxes. The governor says the increases approved by the Utah Legislature will fund sorely needed improvements to transportation and education.

Billy Hesterman, vice president of the Utah Taxpayers Association, said his group is disappointed. He questioned whether the bumps are truly necessary.

The gas tax hike is expected to bring in about $100 million over the next two years, money that will be used to maintain the state’s smaller roads and replace aging bridges.

Democratic Rep. Brian King of Salt Lake City said that while signing off on a tax increase wasn’t easy, he voted in favor because it would help address dramatic transportation deficits in the state.

“I think it was a necessary evil,” King told The Deseret News in Salt Lake City (http://bit.ly/1IbqYsC).

The new law also provides for the tax to rise and fall with the price of gas. It is the first adjustment to the fuel tax since 1997, and the governor said that inflation had robbed the tax of much of its purchasing power.

Hesterman called the fuel tax hike a big jump that taxpayers might not be prepared for. He also questioned why leaders approved tax increases in a year that saw a $700 million surplus.

Republican Senate President Wayne Niederhauser, who is from Sandy, says that figure is deceptive. He says most of that surplus money was already earmarked, much of it for education. Also going to fund education will be a new property tax increase that adds about $50 to the bill for the owner of a $250,000 house.

Utah regularly ranks as having the lowest per-pupil spending for education in the country, and Kings says that the new revenue will help the state “claw out of the basement.”

Republican House Speaker Greg Hughes of Draper said the 2015 session saw the largest funding increases in nearly a decade. The property tax bump was the first change to that tax since 1996.

Lawmakers this year also approved two optional increases, one that allows local governments to ask voters to approve a 25-cent sales tax bump for transportation projects. Another relates to a proposed move of the Utah state prison away from its current location in Draper. The law allows whichever city of town ends up getting the relocated prison to raise local sales tax by up to .5 percent. If it’s enacted, state legislative staff estimate that could cost the average family about $110 a year.

Information from: Deseret News, http://www.deseretnews.com

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