Orange County lawmakers set temporary $2 sales tax cap on gas

Orange County lawmakers approved a temporary cap on the county sales tax charged on gasoline purchases above $2 Thursday night in Goshen, and the real-world savings are small but immediate: about 8.3 cents a gallon, or roughly $1.24 on a 15-gallon fill-up when gas is $4.21 a gallon. The 13-5 vote came after weeks of pressure over pump prices and household budgets.

The move marked a sharp turnaround from April 28, when the Legislature failed 9-8 to approve a broader $3 gasoline sales-tax cap, with four members absent. Since then, neighboring Hudson Valley counties including Dutchess, Rockland, Putnam and Ulster had already adopted caps, and participating counties put the $3 threshold into effect on June 1.

The county’s 3.75% sales tax rate is what makes the cap matter. Without the change, a driver paying $4.21 a gallon would owe county sales tax on the full price; with the cap, the tax stops at $2 of that purchase price. That difference is why commuters, delivery drivers, tradespeople and families in places like Newburgh, Middletown, Goshen, Monroe and Port Jervis are likely to feel the benefit most, even if the relief is modest at each stop.

The politics around the vote were just as important as the math. Orange County’s 2026 executive budget projected $412,339,869 in sales-tax revenue, including $302,879,900 for county operations and $109,459,969 shared with cities, towns and villages. Middletown Mayor Joseph DeStefano and Wallkill Town Supervisor Frank DenDanto opposed the cap in written correspondence, warning that their local governments would take a financial hit.

Inside the Legislature, Democratic Caucus Leader Genesis Ramos argued that the lower cap was aimed at the people feeling the squeeze most directly, saying the $2 limit would "benefit motorists who need it most." The county’s new cap is temporary and is set to run through March 1, 2027 if fuel prices stay above the threshold, giving Orange County a narrower relief measure than the one lawmakers rejected weeks earlier, but one that finally puts the county closer to the regional pattern already in place across the Hudson Valley.