10-Cent Fuel Tax Introduced by Conservative Republican
The Highway Trust Fund Certainty Act, H.R. 2971, would keep the trust fund solvent when the current extension terminates at the end of the month, Rep. Tom Rice (R-S.C.), a member of the Transportation and Infrastructure Committee, told Keith Laing of The Hill.
"We have enough revenue already," he said. "Our measure moves money from the general fund into the Highway Trust Fund. It would raise the gas tax by about 10 cents-per-gallon, which would cost the average driver about $130 per year. It would be offset by a $133 income tax credit, so it's revenue-neutral."
Politics aside, the bill is a good one.
- Yes, the $133 tax credit adds to the budget deficit, but much less than Congress' earlier payroll tax cuts.
- Increasing the gas tax by 55 percent makes the highway trust fund sustainable—for the first time since 2008.
- Indexing fuel taxes enables them to automatically adjust to inflation, further strengthening the trust fund, allowing the Federal Highway Administration to ditch the Highway Trust Fund ticker that's currently counting down the days to the fund's insolvency
- Non-motorists are eligible for income tax credit [I will confirm with Rice's office on Monday].
- The timing is right as gas prices will be low through the rest of the year and into 2016, according to the July 9 short term outlook of the Energy Information Administration (EIA)*.
- Finally, conservative Tom Rice is no liberal Earl Blumenauer (see below). He's rated 85 percent by Heritage Foundation - the group that is pushing devolution, i.e., eliminating the federal gas tax and shifting authority to the states. Average rating among House Republicans is 67 percent. No word yet on how the Highway Trust Fund Certainty Act will affect his ratings.
On the other side of the aisle, "Rep. Earl Blumenauer's [UPDATE] gas tax bill [H.R.680 - Update, Promote, and Develop America's Transportation Essentials Act of 2015] is steadily gaining supporters," reports Politico Morning Transportation. "Just this week, Reps. Rick Larsen and Mike Thompson signed on, bringing the co-sponsor total to 36," though they are all Democrats. The bill would increase gas and diesel taxes by 15 cents in three years and index them to inflation.
*Endnote on gas prices from EIA: "U.S. regular gasoline monthly average retail prices reached $2.80/gallon (gal) in June, an increase of 8 cents/gal from May but 89 cents/gal lower than in June 2014. The price rise between May and June reflects signals of strong gasoline demand in the United States and abroad. EIA expects monthly average gasoline prices to decline gradually from their June level to an average of $2.49/gal during the second half of 2015. EIA forecasts U.S. regular gasoline retail prices to average $2.48/gal for all of 2015."
- United States
- South Carolina
- Government / Politics
- Federal Gas Tax Legislation
- Federal Gas Tax Increase
- Federal Gas Tax
- Rep. Tom Rice
- Revenue-Neutral Gas Tax Increase
- Highway Trust Fund
- Indexing Gas Tax
- Heritage Foundation
- Rep. Earl Blumenauer
- UPDATE Act
- Highway Trust Fund Certainty Act