Gas Tax Increases are Coming Down the Road
Proving yet again that unintended consequences occur from government policies, we’re hearing noise about increasing the gas tax at both the state and federal level. The reason? We’re driving less, conserving fuel and helping the environment as we’ve been urged to do. But now we’re not buying enough fuel to generate the “revenue” to pay for highways and the like. The innovative solution being carted out is more taxes. First, nationally:
The 15-member National Commission on Surface Transportation Infrastructure Financing is the second group in a year to call for increasing the current 18.4 cents-a-gallon federal tax on gasoline and the 24.4 cents-a-gallon tax on diesel. State fuel taxes vary.
In a report expected later this month, members of the infrastructure financing commission say they will urge Congress to raise the gas tax by 10 cents a gallon and the diesel tax by up to 15 cents a gallon. At the same time, the commission will recommend tying the fuel tax rates to inflation.
The commission will also recommend that states raise their fuel taxes and make greater use of toll roads and fees for rush-hour driving.
Well, Rhode Island is ready to follow suit:
The proposals include increasing the gasoline tax, now 30 cents, by up to 15 cents per gallon by 2016, which would raise an estimated $64 million per year. They also include a new “petroleum products gross earning tax,” beginning with the equivalent of 10 cents per gallon of gasoline in 2010 and adding another 5 cents in 2014. That would affect all petroleum products, from gasoline and aviation fuel to those made from petroleum derivatives, such as plastics, paint and fertilizer. It would eventually raise about $66 million per year, the draft report says.
At the state level, the gas taxes haven’t actually gone toward what they were supposed to–roads and infrastructure. Instead, they’ve been lumped into the general fund and all highway renovation has been bonded. (We’ve gone over this a million times). Given this track record, how can Rhode Islanders be assured that “this time is different”?