Fuel Taxes on the Rise

This week, Rep. Earl Blumenauer (D-Ore.) introduced two bills: one to establish a road usage fee pilot program to study mileage-based fee systems (H.R.3638), and a bill that would amend the Internal Revenue Code of 1986 to increase the excise tax on gasoline, diesel, and kerosene fuels (H.R. 3636).

H.R. 3636  was introduced on December 3 and would raise the federal fuel tax by 15 cents over the next three years on gasoline and diesel.

“The gas tax hasn’t been increased since the beginning of the Clinton administration,” said Blumenauer.  “Today, with inflation and increased fuel efficiency for vehicles, the average motorist is paying about half as much per mile as they did in 1993. It’s time for Congress to act.  There’s a broad and persuasive coalition that stands ready to support Congress, including the U.S. Chamber of Commerce, National AFL-CIO, the construction and trucking industry, cyclists, professional groups, numerous associations of small and medium businesses, local governments, and transit agencies. We just need to give them something to support.”

According to Blumenauer, in 2009, the Federal Highway Administration an estimated $70.9 billion worth of repairs are needed to maintain a safe infrastructure.  Since that that estimate, the American Society of Engineers estimates that the U.S. needs over $2 trillion to remain “economically competitive.”

Blumenauer says that Congress has added to the General Fund deficit by transferring more than $50 billion of General Fund revenue to the Highway Trust Fund.

“In order to maintain current funding in the following years, the Highway Trust Fund will need almost $15 billion a year in addition to current gas tax receipts. Continuing down the current path will mean a 30% drop in federal transportation spending by 2024. The UPDATE Act would raise around $170 billion over ten years,” a press release from Blumenauer stated.

“Instituting a reasonable gas tax increase now provides the revenues Democrats say they want with a form of a user fee which historically has been acceptable to Republicans including Ronald Reagan, who increased the gas tax by a nickel a gallon in 1982,” said Blumenauer. “Addressing the infrastructure deficit, stabilizing transportation funding, and helping America’s all-too-slow economic recovery is critical if we want a livable and economically prosperous country in the years to come.”

“American Trucking Associations is very pleased to support Congressman Blumenauer’s proposal to increase and index the federal fuel tax,” said ATA President and CEO Bill Graves. “Underinvestment in highways is an enormous burden on the trucking industry, raising the cost of moving freight and undermining the reliability of a logistics system that is critical to our nation’s competitiveness.  The additional investment in highway projects made possible by this new revenue will significantly improve the safety, reliability and efficiency of the trucking industry, to the benefit of all Americans.”

 

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