by Jon Styf
Tennessee’s corporate aviation fuel tax cap will soon go down to $1 million, which would have an additional $10.6 million impact on the state’s Transportation Equity Fund, after Gov. Bill Lee signed a bill to lower the cap.
The bill is part of a drop in the aviation fuel tax over years. Rep. Mark White, R-Memphis, said FedEx paid $45 million in annual aviation fuel tax when the cap was first installed and will be down to $1 million for the 2024-25 fiscal year.
The current $5 million annual cap per company will cost the state $2.6 million in taxes when it drops to $3 million and then $10.6 million annually when the cap drops to $1 million.
The decreased taxes led to Lee putting $83.2 million in this year’s budget for the state’s airports with $26.3 million in funding coming from the equity fund. That’s up from $50 million of state funding in the 2021-22 budget.
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Jon Styf is an award-winning editor and reporter of The Center Square who has worked in Illinois, Texas, Wisconsin, Florida and Michigan in local newsrooms over the past 20 years, working for Shaw Media, Hearst and several other companies.
Photo “Bill Lee” by Gov. Bill Lee. Background Photo “Gas Station” by Mehluli Hikwa.
