Will a gas tax help lower prices at the pump?

UC economist explains tri-state impact on Cincinnati

WCPO recently reported on Kentucky and Indiana’s steps to combat surging gas prices, with the former cutting its gas tax and the latter extending a suspension on taxes.

Michael Jones, associate professor of economics at the University of Cincinnati’s Lindner College of Business, offered insight into what the changes mean for Cincinnati’s gas prices. 

"Regardless of the state that you're in, every consumer is facing the higher prices," Jones told WCPO. "So governors are naturally trying to come up with ways to alleviate some of that price pressure for consumers."

But even without enacting any gas tax relief in Ohio, Cincinnati could see lower gas prices because of the actions of neighboring states, Jones said. 

"Cincinnati is going to benefit. We're going to be able to free ride on the lower gas prices in Indiana," he said. "And we're not going to suffer the consequences either, because Indiana is going to lose that tax revenue that comes rather than the state of Ohio."

Jones also said that in theory, Ohio gas stations just over the state lines could also lower prices in order to remain competitive.

Read the full WCPO report

Featured image at top of a person refueling a car. Photo/Unsplash

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