Several proposals have recently been put forth by members of Congress to raise the federal excise 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. on gasoline. Some lawmakers see raising the 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. as a way to reduce greenhouse gas emissions, and some see it as a potential source of revenue for improving the nation’s infrastructure.
A recent Baltimore Sun editorial targets the use of earmarked gasoline tax revenue:
A proposal to raise the federal gasoline tax to repair the nation’s 70,000 faulty bridges might have a better chance if it hadn’t been for the “Bridge to Nowhere.”
The infamous Alaska structure designed to serve a handful of remote citizens became a symbol of what’s wrong with the practice of letting federal lawmakers “earmark” tax dollars for their pet projects: The money is not being spent according to safety and transportation priorities.
Before Congress asks taxpayers to pony up more money to fix failing bridges, it must abandon this pork barrel process and ensure instead that transportation dollars are directed to where they are most needed.
A new Tax Foundation Fiscal Fact also encourages lawmakers to examine their priorities and ask themselves several basic questions about gas taxes before raising the tax rate:
In the wake of the Minneapolis bridge collapse, there have been calls for the federal government to increase its gas tax in order to fund transportation infrastructure. Before Congress goes down that path, it needs to ask itself a few questions:
- Should the current transportation funding priorities be changed?
- What is the federal government’s role in transportation today, and why are these new transportation initiatives necessarily the role of the federal government instead of the state or local governments?
- And finally, what exactly is the goal of Congress in terms of funding transportation while also taking aim at energy usage through environmental taxes?
Read the Fiscal Fact, “Questions to Ask Before Raising the Federal Gas Tax,” here. Click here for more on gas taxes.
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