Oregon Voters Reject Gas Tax Increase as Prices Soar

An American flag flies near a sign for fuel prices at a gas station in Portland, Ore. (Jenny Kane/AP)

PORTLAND, Ore. — Oregon voters on May 19 rejected a gas tax increase passed last year by Democratic lawmakers, a victory for Republicans who put the issue to voters as the war with Iran was causing prices at the pump to soar.

Democrats had raised the state gas tax by 6 cents a gallon and increased a series of fees to help pay for road improvements and plug a hole in the state’s transportation budget. Republicans responded by launching a successful referendum campaign to refer the tax and fee increases to voters.

Republican state Sen. Bruce Starr, who helped lead the referendum campaign, said he was “not surprised at all that Oregonians have rejected a completely unpopular tax increase.”

“Oregon voters will not be ignored. Oregon taxpayers will not be ignored,” he told The Associated Press on May19.

Democratic Gov. Tina Kotek and U.S. Sen. Jeff Merkley easily won their primaries, while state Sen. Christine Drazan won the GOP gubernatorial primary to face Kotek. But much of the Election Day drama centered less on candidate races and more on the referendum to repeal the bill passed last fall by the Democratic-controlled Legislature to raise the state gas tax and a range of fees.

The failure of the gas tax was no surprise to Democrats, who acknowledged the timing of the vote was against them. The tax increase also ran counter to national Democrats’ strategy of focusing on affordability concerns in the hopes of winning back control of Congress in this year’s midterm elections.

Oregonians will not see higher gas tax as Measure 120 goes down with strong opposition https://t.co/ejaaG7NCO8 — The Oregonian (@Oregonian) May 20, 2026

Republicans sought to counter Democrats’ affordability messaging by portraying the tax and fee increases as further fueling the high cost of living. Democrats, meanwhile, said the root cause of the spike in gas prices was President Donald Trump’s decision to go to war with Iran.

The legislation was Democrats' answer to help Oregon's transportation budget as the state projects a decline in gas tax revenue from the shift to more fuel-efficient, electric and hybrid vehicles. The gas tax is the largest funding source for fixing roads and upgrading highways.

The referendum, known as Measure 120, landed on the ballot as the cost of gas is spiking nationwide.