Raise the federal gas tax

February 5, 2013

Members of Congress approved spending $198 billion during fiscal years 2012 and 2013 on the war in Afghanistan, according to the Center for Strategic and International Studies. In contrast, in fiscal year 2012, Congress allocated only $37 billion to the Federal Highway Administration for transportation infrastructure. About $23 billion of this spending on highways, bridges and mass transit comes from the 18.4 cents of federal tax Americans pay on a gallon of gasoline. This tax – instituted in 1993 – has not been adjusted (even for inflation) since it was put in place. From McClatchy:

It’s been 20 years since Congress raised the gasoline tax. The 18.4-cents-a-gallon tax has lost a third of its buying power to inflation and rising construction costs.

The tax feeds the federal Highway Trust Fund, which long has paid for a portion of highway construction and repairs in all 50 states.

The fund used to carry a surplus, but lawmakers have bailed it out since 2008 by tapping the Treasury for $50 billion.

‘That can’t continue indefinitely,’ said John Horsley, who retired in January as the executive director of the American Association of State Highway and Transportation Officials. ‘Congress is going to have to find a way to restore funding.’

The Highway Trust Fund was running out of money until Congress allocated $6 billion in November 2012 to replenish the coffers. However, the general budget is being squeezed by increasing costs and special allocations for the U.S. Postal System’s pension fund and the National Flood Relief Program. In fact, the entire amount of the recent tax increase on the wealthy was spent on Hurricane Sandy relief.

The Highway Trust Fund needs a permanent funding solution to tackle building and maintaining America’s infrastructure. The most commonly discussed solution is raising the gasoline tax. How would a higher gas tax affect consumers? The Washington Examiner has some numbers:

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.

$248 per year would equal $4.76 per week, or about half the cost of a carry-out Domino’s pizza. Of course, every driver does not drive frequently on federal highways, but FHA funds can also be used for “bridge projects on any public road.”

There have been complaints about the Highway Fund being used for other purposes than roads, especially on mass transit projects. Heritage picks up that thread:

Since 1983, transit has received a share of the federal user fees paid by drivers, principally through fuel taxes. Additional diversions from federal user fees have been authorized by the Congestion Mitigation and Air Quality Improvement (CMAQ) program. In 2010, the latest year for which data are available, the total diversion from federal user fees approached $6 billion. This left $29 billion for expenditures on highways and roads. The 17 percent share of federal user fees was much greater than transit’s little more than 1 percent of the nation’s surface travel.

How Highway Fund monies are spent is an important issue, and, like all spending, should be evaluated for effectiveness. But there is general agreement that federal transportation spending has declined with consumers driving less in more efficient cars. It’s past time to adjust how the fuel tax, last revised in 1993, is used to support our federal highway infrastructure.



A chart of how FHA funding is allocated to the states

Wikipedia: On average, as of January 2013, state and local taxes add 30.4 cents to gasoline and 30.0 cents to diesel, for a total U.S. average fuel tax of 48.8 cents per gallon for gas and 54.4 cents per gallon for diesel.

One comment

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They should raise it enough to pay for the military cost of protecting oil. That is the single biggest job of our military and the military is the single largest contributer to our debt.

Posted by brotherkenny4 | Report as abusive