Delaware House Republicans propose $100 rebate for all Delawareans

House Republicans are proposing a rebate totaling approximately $100 million that would benefit every man, woman, and child residing in The First State.

Every legal resident of the state, regardless of age or income, would receive $100 under the plan. For example, a household containing a family of four would receive a total distribution of $400.

“This proposal is consistent with what our members have been proposing since early last year,” said State House Minority Leader Danny Short (R-Seaford). “Our state experienced huge revenue surpluses last year, without enacting any significant tax reduction measures. We have again been gifted with large surpluses in the current fiscal year. There is simply no excuse for not moving forward with targeted tax cuts and rebates, returning some of this excess cash to our citizens.”

State House Minority Whip Tim Dukes (R-Laurel) agreed, saying the rebate proposal initially began while House Republicans were exploring the possibility of suspending the state fuel tax for a limited time. “With the dramatic rise in the price of gas hurting so many working families, we thought suspending the state fuel tax might provide a small amount of relief. Unfortunately, this was a tougher nut to crack than most people might realize.”

Delaware imposes a tax of 23-cents-per-gallon on gasoline and 22-cents-per-gallon on diesel. The money generated from the levy – amounting to about $11.5 million a month – is earmarked for the Transportation Trust Fund, where it pays for road projects, including payments on bonds sold to finance this work.

Under Title 30, § 5110(c) of the Delaware Code, the state fuel tax cannot be decreased while there are outstanding bonds being supported (repaid) with the revenue.

“I would have liked to have suspended the fuel tax from now through the July 4th Weekend, but Delaware law will not allow it,” Rep. Short said. “While it can be argued we could suspend or change the law, I do not think undermining sound fiscal policy is prudent.”

Both Reps. Short & Dukes said a fuel tax suspension could also have the unintended consequence of causing lines at gas stations in northern New Castle County as Pennsylvania motorists crossed the border to fill-up.

“With all due respect to our friends in the Keystone State, we’d like our state’s surplus to help Delaware families,” Rep. Dukes said.

Rep. Short said providing a $100 rebate to every legal Delaware resident would provide a more significant benefit to help modest income Delawareans deal with inflationary pressures.

“It is not just fuel that is going up,” he said. “We’re seeing across-the-board increases in the prices of dozens of essential items. It’s more important than ever to give Delawareans their money back.”

Rep. Dukes noted the total amount returned to Delaware citizens should be about $100 million. The 2020 Census recorded 989,948 people living in the state. Current state population estimates slightly exceed one million.

“This is a responsible one-time distribution of surplus money that will not have any ongoing obligation for the state and will not impact future revenue streams,” Rep. Dukes said. “It also amounts to less than one-eighth of the current surplus, providing state lawmakers with plenty of remaining flexibility to consider other proposals.”

The rebate bill, which is expected to be circulated for sponsorship later this week, will direct the Delaware Division of Revenue to devise a plan to carry out an equitable and rapid distribution of the designated rebate within 30 business days of the measure being enacted.

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