State's suspension of gas sales tax was a good move

Gov. Frank O'Bannon announced last week the state's suspension on the gas sales tax will continue until Sept. 15, then be discontinued. The gas tax suspension went into effect July 1, when Hoosiers were paying an average of $1.70 per gallon ' one of the highest prices in the nation.\nThe original suspension was supposed to last 60 days. O'Bannon extended it through Sept. 15 to let Hoosiers enjoy lower gas prices during a traditionally high-traffic Labor Day weekend. The extended suspension also gives retailers a chance to prepare for the 5 percent price increase that will come with the reinstated tax, The Associated Press reported.\nRepublican Senate Finance Chairman Larry Borst was quick to challenge O'Bannon's decision at the time of the original suspension. In a letter to the media, he compared the tax suspension to a $12 million media buy for O'Bannon's reelection campaign, The Associated Press reported. No other governor has ever used the Indiana "energy emergency" statute O'Bannon used to justify his executive order. \nThe timing of the suspension appears to give credence to that argument. O'Bannon could have extended the tax relief for another 60 days, but chose not to do so. If he had, the suspension would have ended just days before the Nov. 7 election. Voters might view that as a tax increase just before they choose him or Republican David McIntosh; that would be bad for O'Bannon, with McIntosh already promising a 25 percent cut in property taxes.\nBut O'Bannon's timing wasn't entirely political. The skyrocketing prices Hoosiers had to pay at the pump, more than $2 per gallon in some places, constituted an "energy emergency" for many individuals and businesses. The governor's move sent gas prices plummeting to a nationwide low. \nFor many, that was a saving grace. People with lower incomes were able to spend money on more important things, such as food for their families. Transport and delivery companies were able to operate normally, without exorbitant overhead costs. Illinois drivers close to the Indiana border were crossing state lines to buy gas, bringing new business to Indiana. O'Bannon's suspension did not rob the state of tax revenues; rather, it improved the state's economic vitality at a time when other Midwestern states were struggling.\nO'Bannon might have been trying to win voters. Only his campaign staff knows for sure. But his executive order saved Hoosiers more than $12 million at gas pumps this summer. Whatever the political motivations, O'Bannon was right to suspend the tax, and most Hoosiers are glad that he did.