RALEIGH — North Carolina drivers could see some relief at the gas pump after Gov. Josh Stein signed legislation Friday, Oct. 9, temporarily suspending the state’s 41-cent-per-gallon motor fuel tax through Nov. 30.
For residents of northeastern North Carolina, where trips to work, medical appointments and shopping can involve long drives, the suspension could help ease transportation expenses. Farmers, commercial drivers and small businesses that depend on gasoline and diesel fuel could also benefit.
The amount consumers actually save will depend on how much of the tax reduction reaches retail prices. A full 41-cent reduction would save $6.15 on a 15-gallon fill-up, although the legislation does not guarantee that every station will immediately lower its posted price by that amount.
The suspension took effect Saturday, Oct. 10, following passage of House Bill 3, known as the “Relief at the Pump” Act. The measure passed the N.C. House 111-1 and the Senate 41-0 during a special legislative session Oct. 7.
The action comes as gasoline prices remain substantially higher than a year ago. According to AAA figures reported Oct. 9, North Carolina’s average price for regular gasoline was $4.09 per gallon, compared with $2.88 a year earlier. The national average was $4.37.
“Rising grocery, utility, and gas prices are making the costs too high for people across our state,” Stein said in an Oct. 9 news release. “I am signing this bill to keep more money in people’s wallets, but this temporary relief is just one step.”
The governor also called for continued efforts to address other household expenses.
North Carolina’s motor fuel tax rate for 2026 is 41 cents per gallon, according to the N.C. Department of Revenue. The new law temporarily suspends that tax on gasoline and diesel fuel through Nov. 30.
The suspension does not eliminate federal fuel taxes, and retail prices will continue to be influenced by wholesale costs, transportation expenses and other market conditions.
Gas stations may also have fuel purchased before the suspension took effect, when the state tax was still included in the cost.
As retailers replenish their supplies, consumers may see more of the tax reduction reflected in pump prices. However, the timing and amount of any reduction may vary among stations.
N.C. Labor Commissioner Luke Farley called on fuel suppliers and retailers to pass the savings along to customers.
“Gas companies, suppliers, and retailers have a responsibility to pass those savings along to the folks at the pump,” Farley said in an Oct. 7 statement. “North Carolina workers shouldn’t have to choose between buying a tank of gas and paying their bills.”
The legislation comes during the fall harvest, when North Carolina farmers rely heavily on diesel-powered equipment and trucks to harvest and transport crops.
The law also addresses the use of red-dyed diesel fuel, which is generally intended for off-road agricultural and other authorized uses.
The state has provided temporary penalty relief for certain highway uses of red-dyed diesel through Dec. 31, 2026.
According to the governor’s office, Stein directed the N.C. Department of Revenue to provide state penalty relief and secured corresponding federal relief intended to reduce fuel expenses for farmers.
The provisions do not constitute unrestricted permission to use red-dyed diesel in any highway vehicle. Eligibility and applicable requirements depend on the specific use and provisions of the law.
The temporary tax suspension is expected to reduce state transportation revenue by approximately $362 million, according to legislative estimates.
North Carolina relies on motor fuel taxes to help pay for highway construction, maintenance, resurfacing and other transportation needs.
To offset the lost revenue, lawmakers included funding from the state’s Stabilization and Inflation Reserve.
The transfer is intended to replace money that otherwise would have gone into the state’s transportation funds during the suspension.
The measure temporarily changes how those transportation revenues are funded rather than eliminating the need for road construction and maintenance funding.
The motor fuel tax suspension is scheduled to end Nov. 30, with the regular state tax returning in December unless lawmakers approve an extension.
The separate red-dyed diesel provisions extend through Dec. 31.
For motorists and businesses across northeastern North Carolina, the immediate effect will depend on retail fuel prices over the coming weeks.
Although the state has suspended its tax, the amount of relief reaching consumers will ultimately be reflected in what they pay at the pump.