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MichiganHB 41832025-2026 Regular SessionHouseWALLET

Transportation: motor fuel tax; motor fuel tax; increase and expand applicability. Amends sec. 8 of 2000 PA 403 (MCL 207.1008). TIE BAR WITH: HB 4180'25, HB 4181'25, HB 4182'25, SB 0578'25Last Action: assigned PA 20'25 with immediate effect

Sponsored By: Tom Kunse (Republican)

Became Law

Transportation: motor fuel tax

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Bill Overview

Analyzed Economic Effects

4 provisions identified: 0 benefits, 2 costs, 2 mixed.

Gas and diesel taxes rise with inflation

You pay a per‑gallon tax on gasoline and diesel. The law sets 26.3¢ per gallon starting January 1, 2017. Beginning January 1, 2022, each year’s rate equals last year’s rate times 1 plus the smaller of 5% or inflation, rounded up to the nearest 0.1 cent. For 2026 only, the base is 51¢ times 1 plus the smaller of 5% or inflation, rounded up. From January 1, 2027 on, the state returns to the annual inflation formula with rounding up.

One-time 2025 inventory tax on fuel

At 11:59 p.m. on December 31, 2025, large fuel holders may owe a one‑time tax. It applies to more than 3,000 gallons in end‑user storage or held for sale above dead storage if the January 1, 2025 rate was already paid or accrued by a licensed supplier or importer. It also applies to more than 3,000 gallons of nonexempt fuel held outside the bulk transfer/terminal system where that prior tax was not paid or accrued. The tax equals the January 1, 2026 rate minus the January 1, 2025 rate, times the taxable gallons. You must inventory, report, and pay by February 20, 2026.

New rules and taxes for fuel terminals

Any site that makes motor fuel and sells it from a rack is a terminal. It must get a terminal operator license, and the position holder must be licensed as a supplier. Terminals owe motor fuel tax on annual fuel losses above 0.5% of all gallons removed. Bills and invoices must show the correct fuel product code and list the tax rate per product; new bills are required if blending happens below the rack. Fuel kept inside the bulk transfer/terminal system is not taxed while it stays there.

How Michigan sets and posts fuel tax

The department must publish the motor fuel tax rate at least 30 days before it takes effect each January 1. The department’s inflation, CPI, and tax rate decisions are presumed correct. A court or tribunal can overturn them only if clearly wrong.

Sponsors & Cosponsors

Sponsor

  • Tom Kunse

    Republican • House

Cosponsors

  • Angela Rigas

    Republican • House

  • Brian BeGole

    Republican • House

  • Cameron Cavitt

    Republican • House

  • Curtis VanderWall

    Republican • House

  • David Martin

    Republican • House

  • David Prestin

    Republican • House

  • Donni Steele

    Republican • House

  • Gina Johnsen

    Republican • House

  • Gregory Alexander

    Republican • House

  • Gregory Markkanen

    Republican • House

  • Jamie Thompson

    Republican • House

  • Jason Woolford

    Republican • House

  • Jay DeBoyer

    Republican • House

  • John Roth

    Republican • House

  • Ken Borton

    Republican • House

  • Luke Meerman

    Republican • House

  • Mark Tisdel

    Republican • House

  • Matt Bierlein

    Republican • House

  • Mike Hoadley

    Republican • House

  • Nancy Jenkins-Arno

    Republican • House

  • Pat Outman

    Republican • House

  • Steve Frisbie

    Republican • House

  • Thomas Kuhn

    Republican • House

  • Tim Kelly

    Republican • House

  • William Bruck

    Republican • House

Roll Call Votes

All Roll Calls

Yes: 184 • No: 69

Senate vote • 10/3/2025

PASSED; GIVEN IMMEDIATE EFFECT

Yes: 24 • No: 12 • Other: 1

House vote • 10/3/2025

roll call

Yes: 98 • No: 11 • Other: 1

House vote • 3/19/2025

passed; given immediate effect

Yes: 62 • No: 46 • Other: 2

Actions Timeline

  1. assigned PA 20'25 with immediate effect

    10/8/2025House

  2. filed with Secretary of State 10/07/2025 01:26 PM

    10/8/2025House

  3. approved by the Governor 10/07/2025 12:10 PM

    10/8/2025House

  4. presented to the Governor 10/06/2025 03:14 PM

    10/7/2025House

  5. bill ordered enrolled

    10/3/2025House

  6. full title agreed to

    10/3/2025House

  7. roll call Roll Call #252 Yeas 98 Nays 11 Excused 0 Not Voting 1

    10/3/2025House

  8. Senate substitute (S-4) concurred in

    10/3/2025

  9. rule suspended

    10/3/2025House

  10. laid over one day under the rules

    10/3/2025House

  11. returned from Senate with substitute (S-4) with immediate effect and full title

    10/3/2025House

  12. RETURNED TO HOUSE

    10/3/2025House

  13. INSERTED FULL TITLE

    10/3/2025Senate

  14. PASSED; GIVEN IMMEDIATE EFFECT ROLL CALL # 272 YEAS 24 NAYS 12 EXCUSED 1 NOT VOTING 0

    10/3/2025Senate

  15. PLACED ON IMMEDIATE PASSAGE

    10/3/2025Senate

  16. RULES SUSPENDED

    10/3/2025Senate

  17. PLACED ON ORDER OF THIRD READING WITH SUBSTITUTE (S-4)

    10/2/2025Senate

  18. SUBSTITUTE (S-4) CONCURRED IN

    10/2/2025Senate

  19. REPORTED BY COMMITTEE OF THE WHOLE FAVORABLY WITH SUBSTITUTE (S-4)

    10/2/2025Senate

  20. RULES SUSPENDED FOR IMMEDIATE CONSIDERATION

    10/2/2025Senate

  21. PLACED ON ORDER OF GENERAL ORDERS

    10/2/2025Senate

  22. DISCHARGE COMMITTEE APPROVED

    10/2/2025Senate

  23. REFERRED TO COMMITTEE ON APPROPRIATIONS

    4/15/2025Senate

  24. PASSED BY HOUSE WITH IMMEDIATE EFFECT

    4/15/2025House

  25. transmitted

    3/19/2025House

Bill Text

  • Public Act

    10/7/2025

    PDF

  • As Passed by the House

    10/3/2025

    PDF

  • As Passed by the Senate

    10/3/2025

    PDF

  • House Concurred

    10/3/2025

    PDF

  • Introduced

    3/6/2025

    PDF

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