Friday, February 27, 2009

Federal Agency Seeks Increase in Gas Tax – Follows Massachusetts Lead

The National Surface Transportation Infrastructure Financing Committee released its assessment of how end users of the U.S. roadways should pay for upkeep. currently, the highways and byways are funded through a Federal Gas Tax, this Commission has decided that an increase in the gas tax of .10 cents per gallon is imperative to continue to keep our roadways sound. Coined “A Blue Ribbon Panel” by the New York Times, the Committee is concerned that, with a shift to more fuel efficient vehicles, the current Federal Tax of 18.4 cents per gallon, will be insufficient to cover costs of maintaining the infrastructure. The Los Angeles Times brought into question the 8 billion dollar bailout of the Transportation Highway Trust Fund last year, apparently due to a decrease in driving over an increase in the price per gallon that was a direct result of the decline in Retail sales that added fuel to the fire of recession. The majority of the stimulus rebate checks of 2008 went directly to pay mounting fuel charges rather than towards the purchase of non-essentials. Further, there is $40 Billion in stimulus that is earmarked for Infrastructure, however, the panel insists that this will only cover three months of funding (perhaps they have a similar payroll to the Massachusetts Turnpike Authority).
The solution: some officials within the Obama administration, taking a cue from the “Blue Ribbon Panel” came up with a tax per mile driven, which was quickly rejected by the President. (Who may be watching that nasty Daily Gallop Tracking Poll.)

The tax per mile system is also being considered by Massachusetts Governor Deval Patrick, who is trying to meet a bloated Turnpike Authority Payroll and debt incurred for Boston’s Big Dig – Patrick has put that plan on hold, for the moment, instead calling for a .19 cent hike in the current State Gas Tax. Residents of Massachusetts will be the state paying the highest gas taxes in the nation.

Should the Federal Government raise the tax further, it will further erode the “stimulus” tax cuts of $13.00 per week (depending upon whether or not one has a job to drive to and fro). Further, the fact that consumers changed habits in order to conserve gasoline and save a few dollars out of necessity and at the urging of certain candidates during the 2008 presidential campaign marathon, one has to find it ironic that consumers who acted in good faith, are now going to pay through the nose, both at the pump and in the long-run through taxes (someone has to pay for the “stimulus”).

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