HB 5585 Summary

• Adds a variable tax on gasoline and diesel fuel beginning October 1, 2020, calculated as a percentage of average wholesale fuel prices: 2% (Oct 2020-Sept 2021), 4% (Oct 2021-Sept 2022), and 6% (Oct 2022 onward).

• Establishes definitions for "average wholesale gasoline price," "average wholesale diesel fuel price," "wholesale gasoline price," and "wholesale diesel fuel price" based on 12-month rolling averages of Michigan rack prices.

• Maintains the existing fixed tax rate of 26.3 cents per gallon on both gasoline and diesel fuel enacted in 2017, with the new variable tax applied in addition to this base rate.

• Beginning January 1, 2022, requires the department to adjust the fixed 26.3 cents-per-gallon rate annually by multiplying by 1 plus the lesser of 5% or the inflation rate, rounded up to the nearest 1/10 cent.

• Bill is contingent on the enactment of HB 5582, HB 5583, HB 5584, and HB 5586 in the 100th Legislature.