With the “fiscal cliff” looming over Washington, D.C., CNNMoney correspondent Steve Hargreaves has proposed that one of the tax increases that should be on the table is a hike on the cost of the gasoline you buy to keep the family car running.
“Currently at 18.4 cents a gallon, the federal gas tax is used primarily to build and repair roads, bridges and other transportation infrastructure,” he stated in an article posted Wednesday on the CNN site. “The tax raises about $32 billion a year.”
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The government hands out about $50 billion a year to states and towns to help with road costs. The difference comes out of general funds or has to be borrowed. Meanwhile, the gas tax hasn't been raised since 1993.
"Establishing a sustainable resource base for transportation needs to be part of any grand bargain," stated Emil Frankel, a former transportation expert in the George W. Bush administration and now director of transportation policy at the Bipartisan Policy Center.
"In the short run, raising the gas tax is the best way to do that,” Frankel said.
Hargreaves then stated that raising the tax on gasoline was one of the recommendations of the Simpson-Bowles debt-reduction plan in 2010.
The plan called for a 15-cent-a-gallon hike in the gas tax, a level that would basically cover the current shortfall in the transportation budget.
Then, in an apparent attempt to justify the increase on the tax that would add to the burden on everyone with a car, the reporter stated that others have proposed even higher rates.
“In a 2010 letter to the commission, Delaware's Democrat Senator Tom Carper and former Ohio Republican George Voinovich proposed a 25-cent-a-gallon hike,” with the other 10 cents per gallon going toward debit reduction, Hargreaves noted.
“The pair estimated it would generate $83 billion over five years to chip away at the debt, and an additional $117 billion for road repairs,” he added.
But, as is often the case when liberals attempt to take more money out of your income, “not everyone is convinced a gas tax hike is the way to go. “
The gas tax is politically unpopular, mostly because it's regressive -- meaning it hits the poor more than the rich. It's also regionally biased. Most big bridges and highways are near cities, yet those in rural areas would pay the same in taxes.
"The burden would fall on the great middle class, not on the millionaires and billionaires," asserted Ken Orski, publisher of the infrastructure industry publication Innovation NewsBriefs. "That's why the White House is staunchly opposed to such an increase, and why there's virtually zero support in Congress."
“That's one reason the tax hasn't increased in nearly 20 years, even as labor, steel and asphalt costs have risen sharply,” Hargreaves continued. “Plus, as fuel efficiency increases, Americans can put more miles on roads while at the same time buying less gas, worsening the shortfall.”
But don't despair! The reporter said that there are other ways to “plug the funding gap” by extracting money from the people who travel to and from work in their fuel-efficient vehicles.
One of those methods is to institute a “mileage-based driving tax,” which Hargreaves asserts would shift more of the burden to the states or private funding sources that would then charge the public “user fees.”
User fees, yet another way to avoid using the word “taxes.”
While the correspondent's calls to congressional staffers yielded little in the way of support for raising the tax at this time, one Democrat staffer offered the encouragement that with Republicans “softening” to the idea of raising taxes in general, “possibilities for this sort of talk has at leased opened a bit.”
Isn't bipartisanship grand?
