As part of his new tax plan, the president has proposed ending the “step-up” in tax basis for inherited assets, and, furthermore, requiring the capital gains tax to be paid at death rather than when an heir later sells...
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- Road Spending by State Funded by User Taxes and Fees, Inc...
Road Spending by State Funded by User Taxes and Fees, Including Federal Gas Tax Revenues
This morning we released a report ranking state and local road spending financed by user taxes and fees (like tolls and gasoline taxes), finding that every state finances most of its road spending though general taxes (like property taxes, sales taxes, and general funds). We also included a table on transportation generally, including mass transit, water transportation, air transportation, and parking.
We've gotten a fair amount of attention, with many people surprised that roads are so heavily subsidized. One critique we've gotten is that we did not include federal aid as a "user charge." That's because it's not: federal aid is dispensed to the states at the mercy of the federal government and is not connected to users. The table looked at state-local revenues and state-local spending.
However, a fair argument could be made that the portion of federal aid (about $28 billion) financed by the 18.3 cent per gallon federal gas tax ought to be included, which would be a federal-state-local table of road spending provided by user taxes and fees. We ran the numbers, using Federal Highway Administration data for 2010, and that table is below. The percentages are higher, and some states jump around (primarily due to federal funding formula generosity toward small states like Rhode Island) though the conclusion is the same: user taxes and fees do not cover the costs of road spending in any state.
Share of Federal, State, & Local Road Spending
|District of Columbia||4.8%||(51)|
Source: Tax Foundation calculations from U.S. Census Bureau, State and Local Government Finance and Federal Highway Administration data. Road spending is federal and state motor fuel tax revenue and state highway revenue divided by state highway spending.
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The Tax Policy Blog is the official blog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.