InflationReal EstateInvestingCompensationCareersStudent Loans and Debt

These states are proposing sending residents money to combat rising inflation, from tax rebates to stimulus checks up to $850

March 25, 2022, 5:52 PM UTC

States are responding to decades-high inflation with a variety of measures to help cash-strapped residents, including sending fuel debit cards and implementing tax credits.

Inflation has risen 8% over the past year, straining household budgets across the country. Gas prices are especially onerous for drivers, averaging over $4.20 a gallon.

With many states still having surplus funds from COVID-19 federal aid packages to spend, at least a dozen, led by both Democrats and Republicans governors, have announced measures for mitigating some of the effects of inflation on their residents. Many of the measures are included in state budget proposals, which means it will be a few months before residents benefit from them.

Here’s a breakdown of some of the state stimulus efforts so far.


California has floated a few stimulus measures to help residents. This week, Governor Gavin Newsom, a Democrat, unveiled a proposal that would send $400 direct payments to California car owners (sent via debit card and capped at two payments), provide free public transportation for three months, and reduce fuel taxes.


Georgia Governor Brian Kemp, a Republican, announced Wednesday the state will provide a one-time tax credit for both 2020 and 2021. The Georgia Department of Revenue will automatically credit the refunds once taxpayers file their 2021 returns, amounting to $250 for single filers, $375 for head of household, and $500 for married filing jointly.


In his state-of-the-state address in January, Hawaii Governor David Ige, a Democrat, proposed sending $100 to each taxpayer and their dependent(s). Ige’s press secretary did not immediately respond to Fortune‘s inquiry on where this rebate stands.


In February, Idaho Governor Brad Little, a Republican, signed off on a measure to send tax rebates amounting to either $75 per taxpayer and each dependent, or 12% of their 2020 taxes, whichever is greater. Taxpayers need to residents of the state for 2020 and 2021, and have filed tax returns for both years, in order to qualify.


Indiana residents will receive $125 each after they file their 2021 tax returns. The state legislature recently expanded the rebate so those who typically earn too little to file a tax return also qualify for the payments.


Democratic Governor Janet Mills proposed that all Maine residents be sent $850 in direct payments. The measure — one of the most generous among the states so far — has bipartisan support but still needs to be approved by the state legislature, according to local news sources. The state said the payments could go out starting in June 2022.

New Mexico

Governor Michelle Lujan Grisham, a Democrat, signed a bill earlier this month that includes a refundable child tax credit worth up to $175 per child, as well as a one-time, refundable income tax rebate worth $250 for qualifying single filers and $500 for married couples filing jointly.

Gas tax holidays

Connecticut, Georgia, and Maryland are the three states that have responded to price increases at the pump by temporarily cutting state gasoline taxes. The measures vary in each state. Other states considering a similar gas tax holiday include California, New Jersey, New York, and Ohio. State gas tax and fees average around $0.39, according to the American Petroleum Institute.

There has also been calls in Congress to suspend the federal gas tax. That said, there is bipartisan opposition to the move, which some lawmakers argue wouldn’t amount to much help for people.

State tax cuts

Though not a direct response to rising inflation, several states, from Colorado to Georgia to South Carolina, have also proposed cutting state income tax rates in response to state budget surpluses.

Never miss a story: Follow your favorite topics and authors to get a personalized email with the journalism that matters most to you.