COVINGTON, Ky. — As surging gas prices continue to push consumers to the edge, Kentucky and Indiana state leaders are taking action, which could marginally lower gas prices in Cincinnati, one economics expert said.
Gov. Andy Beshear signed an executive order on Wednesday declaring a state of emergency in the Commonwealth, which will allow Kentucky to cut its gas tax by 10 cents per gallon starting Monday.
"The price of gas isn't partisan," Beshear said. "It's not Democrat or Republican. It's just too high."
The move follows actions taken by Indiana Gov. Mike Braun in early April, as he announced a 30-day suspension of the state's sales tax on gas. On Wednesday, Braun extended the suspension another 30 days and announced he would be suspending the state's gasoline excise tax for 30 days as well.
WATCH: What moves are taking shape at the state level to lower gas prices?
"You've heard me say it many times. The affordability issue, I think, the most important thing," Braun said. "If you're not listening, you're not paying attention."
Combined, the suspension of both taxes could net drivers 59 cents per gallon in savings.
According to AAA, average gas prices across the Tri-State are approaching $5 per gallon:
- Kentucky—$4.32 per gallon
- Indiana—$4.72 per gallon
- Ohio—$4.78 per gallon
"Regardless of the state that you're in, every consumer is facing the higher prices," Michael Jones, economics professor at the University of Cincinnati, said. "So governors are naturally trying to come up with ways to alleviate some of that price pressure for consumers."
Jones said the actions are a temporary solution, or buffer, for an issue that can only be fixed at the federal and international level.
"Gasoline is obviously a global market," he said, "Each state makes up such a small percentage of the global usage of gasoline that whatever one state is going to do is not really going to affect what's happening."
As for Ohio, where gas prices have spiked 24% in the last month, on average, Gov. Mike DeWine recently rejected a proposal to suspend the state's gas tax.
According to News 5 Cleveland, DeWine opposed the plan, arguing that the tax money is essential to maintain and construct roads, highways and bridges — as well as fix potholes.
"We like to have good roads, and we like to be able to drive, and we also know that when we have huge holes in our roads, that can have a real impact on your car," DeWine said.
Even without enacting any gas tax relief, Ohio, and specifically Cincinnati, could see lower gas prices based on actions taken across state lines, 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 said, in theory, as gas stations in Indiana and Kentucky lower prices given the tax breaks, Ohio gas stations just over the state lines could follow suit in order to remain competitive.
"You see this anytime you have sales tax holidays, for example, when Ohio temporarily lowers its sales tax," Jones said. "Ultimately, unless those funds are being diverted to other use cases, it's those states that are losing out when you see a lowering of those gas taxes."
Beshear also announced on Wednesday that in addition to the 10-cent reduction, a separate emergency order he signed will freeze the gas tax, preventing a 2-cent increase in July.
