A bill proposing an increase in the federal tax rate on gasoline has been put forth in the House of Representatives. According to the proposal, footed by Oregon Democrat Earl Blumenauer, the tax rate would be increased by 15 cents per gallon, moving it upward to 33.4 cents.
According to Blumenauer, the move would serve as a way to raise funds to improve infrastructure, including roadways across America. Several reports have indicated that many of the country’s roadways are badly in need of repair and improvement, and there are many areas which could do with entirely new roadways as well. With funds in Washington extraordinarily tight, and debt levels spiraling out of control, Blumenauer’s proposal would serve as an effective means of getting money into the hands of roadways improvers on an immediate basis.
However, the proposal is likely to face criticism from House Republicans, who have vehemently opposed tax increases over the course of the past few years. Republicans have opposed collecting additional revenues, instead looking for spending cuts and other ways to trim expenses as a priority.
Proponents of the initiative note that the federal gas tax has been unchanged since 1993. This means that, because prices have risen so dramatically in the interim, the percentage tax on gasoline has actually decreased considerably over the course of the past two decades. In this way, they argue that Blumenauer’s proposal is effectively just bringing the tax up to speed with inflation. They also cite studies that show that American motorists would prefer to pay additional taxes to have well-maintained roadways.
Opponents of the proposal are sure to point to the already-high tax rate on gasoline, which, between federal, state, and municipal duties, notches into the range of 15-20 percent in many areas already. With the increase, the rates would only stand to rise higher. In addition, they note that falling fuel costs have helped many motorists make commuting and traveling more affordable, gains that could all be wiped out by the tax. Though the tax may not hit as hard when prices are low, when the rebound later, the effects will be doubly noticeable.
Tax or no tax, there is a consensus among those in Washington that action needs to be taken to raise money in support of roadway maintenance. The trust fund that provides money for the cause is expected to be $15 billion short per year of funding the nation’s needs, and congress has already had to appropriate general taxation funds to the initiative in years past. According to Blumenauer’s estimates, the gas tax would raise sufficient money to make any such contributions minimal over the course of the next several years, if not longer.