Big business wants a big gas tax hike
The recently passed tax reform law has been touted as putting billions of dollars back into the pockets of individual taxpayers, in addition to giving corporations tax relief that will help them create more economic growth.
With President Trump and Congress turning their attention to infrastructure in the coming weeks, the U.S. Chamber of Commerce is preparing for an uphill battle: a push to raise the federal gas tax by 25 cents per gallon to help pay for the initiative.
The proposal, which will be formally introduced later this week, is part of a series of principles the nation’s largest business lobby will offer in a bid to help shape the debate about upgrading U.S. roads, bridges, airports and other critical infrastructure.
Chamber President Thomas J. Donohue said his organization wants “to put our oar in the water” and acknowledged that it would be “a tough vote” to raise the gas tax for the first time since 1993. But he said that support has been building in the business community and elsewhere.
“I’ve been pushing this for a long, long time, but now gangs of people are pushing it,” Donohue said in an interview in which he also said immigration reform would be critical to ensuring that sufficient labor is available for public works projects.
You pay more for gas -- a lot more -- and we'll loosen the immigration laws enough to make sure you don't get a raise, either. That's just peachy. Surely Republicans -- who were put on this earth to cut taxes -- are against the idea, right? Not really:
In private meetings, Trump has floated the idea of raising the federal gas tax by as much as 50 cents per gallon but received a chilly reception to that idea, particularly from Republican lawmakers. Still, aides say, the idea of an increase hasn’t been taken off the table.
That's swell. But we can expect whatever proposal on gas taxes is put forward (and make no mistake, it won't be a cut), that government will spend each and every dollar wisely to improve our nation's infrastructure. Right? Once again, not really:
The federal Highway Trust Fund—where the gas tax is deposited—has a similar problem of spending on local transit and other non-road-related projects, undercutting the argument that it is simply a user fee paid by drivers.
Some 15 percent of the federal gas tax is deposited straight into the Highway Trust Fund's Mass Transit Account, which disburses money for local bus, light rail, and other mass transit services. Another $850 million or so of the trust fund is diverted to the Transportation Alternatives Fund, which goes to beautifying streets and building recreational trails.
That's what is otherwise knwon as a wealth transfer -- though a more common way to look at it is robbing Peter to pay Paul.
We understand, and appreciate, that the nation's roads and bridges, ports and airports, need fixing. Hiking the gas tax, though, is not the way to do it. We suggest the federal government first put every dime of gas tax it collects to roads and bridges -- not trails, parks or trains. Drivers have every right to expect that if they pay a tax they are told supports road maintenance, then that's exactly what the tax does...and nothing else.
Further, the government needs to look beyond the per gallon tax for a way to fund roads. Greater fuel efficiency, coupled with the growth of alternative fuel sources means the days of collecting a tax at the pump are numbered. What sort of scheme replaces the per gallon tax? We do not know. But there are a number of ideas out there (some more intrusive than others) and they should get a full hearing.
In the meantime...keep an eye on the big business lobby, because they are reaching for your wallet (again).