Obama Mulls Replacing Gas Tax With Hefty Mileage Tax
One reason gas prices are so high is that the Feds impose a tax of 18.4 cents per gallon on gas. It’s 24.4 cents per gallon of diesel. We’ve had federal gas taxes since the 50’s to pay for highways and bridges, but since 1983, they started diverting about 20% of gas taxes to go to a Mass Transit Account that is supposed to pay for public transportation like buses and railways. So, those of us who don’t use mass transit are paying for those that do in the form of gas taxes. That’s socialism for you.
We’ve had the 18.4-cent per gallon tax since 1993 under the Clinton administration. Nowadays, with the further destruction of the dollar, that 18.4 cents just doesn’t buy what it used to. Now, the Highway Trust Fund (which includes the Mass Transit Account) is facing insolvency.
Some credit the loss of revenue to the fact that many are using more fuel-efficient cars and therefore not spending as much on gas. Isn’t that what Obama wanted? For people to use more “green” energy? And now, the Highway Trust Fund is running out of money.
That could be part of it, but billions of the gas tax revenues are used to fund pet mass transit projects, which those who drive cars generally don’t even use.
Whatever the cause, the Obama administration is thinking of scrapping the gas tax altogether. Sounds good so far, but they’re wanting to replace the gas tax with a pay-per-mile scheme. The Washington Examiner reported:
“The average driver pays about $96 a year in federal gas taxes, said GAO. Should the administration seek to raise the highway trust fund from $34 billion to the $78 billion needed to fix and maintain roads, that could rise to $248. Translated into a pay-per-mile plan, drivers would face a tax of 2.2 cents per mile compared to the 0.9 cents they pay now. Trucks would pay far more.”
In the past when the Highway Trust Fund ran out of money, they would just take money from the General Revenue Fund. If the federal government has to pay for highways and bridges, maybe they should just cut spending elsewhere and use the General Revenue instead of levying such heavy taxes on Americans, a fifth of which is used to pay for things that drivers don’t even use. With the economy the way it is, and with people’s paychecks going down, now is not the time to raise even more taxes on drivers.
The federal government could at least eliminate the Mass Transit Account, which is funded by our gas taxes. Writing for Reason magazine, Tim Cavanaugh pointed out that the Mass Transit Account hasn’t convinced more people to ride public transportation even in the past 30 years:
“According to American Public Transportation Association, Americans in 1983 took 8.2 billion transit rides. In 2008, the last year with complete statistics, we rode the bus, commuter rail, paratransit, heavy rail, light rail, trolley-bus, or “other” 10.5 billion times. The Census Bureau has 1983 U.S. population at 234 million and 2008 U.S. population at 304 million. That comes to 35 rides per American in 1983 and 34.6 rides per American in 2008. “
If states want to have public transportation, they should raise their own revenue and pay for it themselves instead of taking federal highway funds to build it. As for paying for highways and roads, we could cut hundreds of billions of dollars from Obama’s foreign policy expenditures and put those funds toward domestic infrastructure and not have to impose one penny of gas taxes to fund it.