Last night I spoke at the Cato Institute on an America’s Future Foundation panel called “TaxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. ing the Holiday Spirit,” where I was tasked with addressing the tax bite on travel that a lot of families endure as they visit loved ones this season. I started running the numbers for my own Thanksgiving travel, and the costs are pretty substantial; my family will spend $165.15 on gas taxA gas tax is commonly used to describe the variety of taxes levied on gasoline at both the federal and state levels, to provide funds for highway repair and maintenance, as well as for other government infrastructure projects. These taxes are levied in a few ways, including per-gallon excise taxes, excise taxes imposed on wholesalers, and general sales taxes that apply to the purchase of gasoline. es and tolls for our trip up to Northern New Jersey next week.
Below is the breakdown of our tolls, some of which are really hefty (even the ones that are only charged when you are traveling northbound or southbound). The total trip costs $46.90 in tolls per car!
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Tolls, DC to Northern Jersey |
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Toll |
Cost |
One Way? |
|
Baltimore Tunnel (MD) |
$3.60 |
|
|
JFK Memorial Highway (MD) |
$7.20 |
Northbound |
|
Delaware Turnpike (DE) |
$4.00 |
|
|
Delaware Memorial Bridge (DE) |
$4.00 |
Southbound |
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New Jersey Turnpike (NJ) |
$7.25 |
|
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Garden State Parkway (NJ) |
$3.00 |
|
|
Northbound tolls |
$25.05 |
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Southbound tolls |
$21.85 |
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Total Tolls per Car, Roundtrip |
$46.90 |
My family is all DC-based, but we will be taking three cars up to New Jersey, partially because of schedules of my family and our significant others, but also because sometimes it's better to avoid the dynamic of trapping the whole clan in a small box hurtling up the highway for five hours. Below, I’ve run the numbers on the various state and federal gas excise taxAn excise tax is a tax imposed on a specific good or activity. Excise taxes are commonly levied on cigarettes, alcoholic beverages, soda, gasoline, insurance premiums, amusement activities, and betting, and typically make up a relatively small and volatile portion of state and local and, to a lesser extent, federal tax collections. es and fees in each of our cars based on their mileage per gallon. The trip is about 500 miles, and when you add the three cars together, this makes for $24.45 in gas tax liability for the family.
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Gas Taxes in Virginia |
My Family's Gas Taxes |
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|
State Excise Tax |
$0.148 |
Chevy Impala (29 mpg) |
$6.14 |
|
|
Other State Taxes and Fees |
$0.025 |
Jeep Grand Cherokee (19 mpg) |
$9.39 |
|
|
Federal Excise Tax |
$0.184 |
Toyota Highlander (25 mpg) |
$8.93 |
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|
Total Taxes per Gallon |
$0.357 |
Total Gas Tax Burden |
$24.45 |
So all told, gas taxes and tolls make for $165.15 in additional holiday costs. That’s probably more than our total contribution in groceries to Thanksgiving dinner. But believe it or not, my policy takeaway from this is that gas taxes and tolls are some of the better levies out there for transportation infrastructure funding. For the most part, they charge the people who use and wear the roads, as opposed to income or sales taxes, which just clumsily tax everyone and then provide roads for “free.” Across the country, states generally don’t lean on gas taxes and tolls as much as they could. On average, they only pay for a third of state and local road spending.
So if you drive this holiday season on a toll road, don’t get too upset—this is one of the few times where you make a payment to the government and you get something directly in exchange. We could use more of that.
Happy Thanksgiving!
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