NC lawmakers consider pausing the gas tax
Suspending state gas taxes in North Carolina could lead to delays in roadwork, according to a leading economist.
House Speaker
Destin Hall, R-Caldwell and Senate Leader
Phil Berger, R-Rockingham, announced over the weekend they plan to call lawmakers back to Raleigh for a special session on reducing gas prices. Both chambers will meet on Wednesday, according to legislative calendars released Monday evening.
At 41 cents per gallon, North Carolina has one of the highest gas taxes in the country. That revenue goes towards building, repairing, and maintaining roads. Lawmakers could suspend or repeal part or all of it.
NC State economist and professor emeritus Mike Walden said drivers can expect to see a “noticeable decline” in what they’re paying at the pump if lawmakers decide to suspend the tax.
“But the state gas tax is a major source of funding for road repair, road expansion, and other road improvements,” Walden said. “Much of this work would stop during the tax suspension.”
Some of these projects could include construction on the I-26 connector in Asheville and widening I-40 around the Triangle, according to the North Carolina Department of Transportation website. NCDOT did not immediately respond to NC Newsline’s request for comment.
Walden thinks drivers would be willing to accept a temporary slowdown in roadwork for lower gas prices.
“My expectation is the legislature would suspend the tax for a limited period of time, and then re-impose it so road spending can continue,” Walden said.
Some Republican state lawmakers have suggested that they could offset the lost tax revenue with funding from state reserves.
“We have some surplus revenue,” Rep.
Grant Campbell, R-Cabarrus, said in a post on social media Monday. “This is going to give us the opportunity to temporarily suspend the gas tax.”
The action comes as North Carolina polls show declining approval numbers for President Donald Trump and Republicans down the ballot. National GOP groups are pulling spending from U.S. Senate Michael Whatley’s campaign, opting to focus on other states instead.
Democrats say it’s a political move.
“We’re glad to see legislative Republicans finally acknowledge that the Trump administration’s war of choice in Iran and tariffs have led to sky-high fuel prices for North Carolina families and farmers,” said a spokesperson for Gov. Josh Stein in a statement Monday. “If they’re serious about lowering costs long after the campaign ads stop, let’s also get to work on the Governor’s Working Families Tax Cut and heed his calls to protect our electricity bills from data centers’ massive energy consumption.”
Senate Democratic Leader
Sydney Batch, D-Wake, criticized GOP leadership for calling a last-minute session rather than addressing affordability earlier. She pointed out that the House and Senate met just last week for an administrative session that was already on the schedule.
“This is the exact same pattern, from the same failed, weak leadership that took three years to produce one state budget,” Batch said in a statement. “Session after session, we’ve seen that when it comes to protecting their own power, Republicans will move with lightning speed. But when your family needs help, they’ll wait until it’s politically convenient for them.”
Harbor Project
The N.C. State Ports Authority has suspended its proposed Wilmington Harbor deepening project in response to concerns over environmental impacts. The authority has requested to pause consideration of the $1.35 billion navigation improvement project, which would have deepened the channel along the Cape Fear River in an effort to accommodate larger container ships, according to a letter from Executive Director Brian Clark to the U.S. Army Corps of Engineers. Clark also requested the suspension of consideration of the associated Wilmington Harbor 403 Letter Report activities and the pending record of decision. The project called for deepening 26 miles of the Cape Fear River shipping channel from its current 42 feet to 47 feet. The six-year undertaking also proposed widening and deepening of the shipping entrance channel at the mouth of the river. In the letter, Clark cited concerns over stirring up per-and poly-fluoroalkyl substances, commonly known as PFAS or "forever chemicals," for the suspension. The N.C. Ports will embark on a new strategic plan, which "calls for an overall increase in tonnage traversing the Wilmington Harbor," according to the letter.
Farm Diesel
Gov. Josh Stein is moving to allow North Carolinians to use off-road diesel in trucks, a measure that could help farmers save money as diesel prices reach record highs. On Wednesday, a group of 25 farming trade associations wrote to Stein, asking him to take action to help curb diesel prices.
Since the United States attacked Iran in February, diesel costs have spiked in North Carolina, rising from under $4 in February to $6.25 in September. For farmers who rely on diesel fuel to operate their equipment, the surge in fuel prices has taken a toll.
“Coupled with rising input costs, these increases are further eroding already razor-thin margins for our food and fiber producers,” the agricultural groups wrote.
Stein then announced he was directing the N.C. Department of Revenue to suspend penalties for using off-road diesel in trucks and other on-road vehicles.
Many of the state’s farmers have stores on hand of red-dyed diesel fuel — a type of fuel that’s basically the same as typical diesel, but is only allowed to be used in agricultural equipment or other machines. It’s not subject to state and federal highway excise taxes, and costs less than typical diesel fuel. Usually, people can face hefty fines for using red-dyed diesel in on-road vehicles.
Under the governor’s new order, North Carolina farmers will be able to use red-dyed diesel to drive pickup trucks and haul crops to markets without facing a penalty.
“Since many agricultural producers have stores of non-taxed dyed diesel fuel on hand for off-road use, suspending enforcement of this prohibition will provide farmers relief during the harvest, the most fuel-intensive component of agricultural production,” Stein wrote in a letter to Secretary McKinley Wooten of the N.C. Department of Revenue.
Traffic Laws
In a crowded hotel conference room in Raleigh Tuesday, traffic safety researchers, industry experts and state government officials attended the final summit hosted by the North Carolina Alliance for Safe Transportation.
On the agenda: how to improve North Carolina’s distracted driving, speeding and impaired driving laws to reduce traffic fatalities.
“I read every day about the number of crashes we have in North Carolina, because there’s a story behind each of those stats,” said Mark Ezzell, director of the governor’s Highway Safety Program.
Ezzell says state lawmakers should keep trying to strengthen laws for impaired driving, including passing a law requiring ignition interlocks for first-time offenders.
These breathalyzer devices are installed on a car’s computer system. Drivers must breathe into them before starting the engine. If the device detects alcohol, then the car won’t start.
Currently, North Carolina does not require ignition interlocks for first-time DWI offenders. Earlier this year, a bill known as the SEATBELT Act would have required ignition locks for all drivers convicted of driving while impaired regardless of prior offenses, but it died in committee.
Ezzell also said lawmakers should strengthen North Carolina’s distracted driving laws, including adopting a hands-free requirement for drivers. He said his organization has pushed for years for a hands-free law like those in neighboring states.
North Carolina currently prohibits drivers from reading or texting while driving, but doesn’t have a broader law that prevents drivers from holding or using any device behind the wheel.
Another recommendation was to expand the use of cameras in school speed zones. North Carolina is currently experimenting with speed cameras in pilot school zones, following legislation passed in 2025. Ezzell said lawmakers should implement it across the state.
The organization has hosted three other summits in the state in Wilmington, Statesville and Asheville, where officials heard directly from attendees about what changes they wanted to see to North Carolina’s traffic safety laws.
The meetings were intended to help identify priorities lawmakers could take up next year during the legislative session, according to the organization’s agenda.
NCAST Executive Director Joe Stewart said speeding was a recurring concern among participants at each summit.
“Speeding is a menace,” he said. “Traffic cameras can make a big difference in enforcement and free up officers for other duties.”
Sen.
Vickie Sawyer, R-Iredell, co-hosted the events. She chairs the Senate Transportation Committee. She said common themes she’s heard from audiences across the state have been concerns about electric bikes, distracted driving and road rage.
Caterpillar Investment
Caterpillar Inc. plans to invest approximately $1 billion in North Carolina to expand manufacturing capacity for products that support its growing Cat Compact business, helping customers gain faster access to the machinery they need to tackle tough jobsite challenges and build homes, infrastructure and communities. The investment includes plans for a new, modern manufacturing facility in Sanford, North Carolina, to increase production of compact track loaders and telehandlers to meet customer demand. North Carolina was selected for the investment because of Caterpillar's longstanding presence in the state, the strength of the local workforce and the opportunity to build on existing manufacturing expertise and operations in Sanford. The project supports Caterpillar's Cat Compact strategy, which is focused on delivering a more streamlined and convenient experience for small contractors and growing businesses.