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house Bill H.R. 1458

Should the Federal Gas Tax Be Increased?

Argument in favor

The federal gas tax hasn’t been increased since 1993, and as a result funding available for America’s infrastructure needs has fallen short of what’s needed. Increasing it a few cents per gallon in stages will help finance much-needed public transportation, road, and bridge repairs and construction that benefit all Americans.

burrkitty's Opinion
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12/08/2018
It would be more effective to STOP SUBSIDIZING BIG OIL resulting in The US government saving 16 billion annually from leaving the government coffers in the first place. But sure raise taxes. Anything that brings it closer to it’s real cost. Also stop allowing oil exports while we have a net oil trade deficit. It makes zero sense. Oil companies are making 300+ billion dollars profit annually. They don’t need the subsidies. Voilá, money for infrastructure.
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David's Opinion
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12/08/2018
Money could be used for renewable resources instead... seems like a no brainer
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Donald's Opinion
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12/09/2018
Increase the tax and make sure the proceeds only go to the improvement and maintenance of our road and highways with no funds being siphoned off to non roads or highway projects.
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Argument opposed

Gas taxes are regressive and an increase will hurt Americans’ finances between higher prices for gas and consumer goods. States, not the federal government, are the owners of most highways and roads, and over half — 33 — have already increased their own gas taxes in order to pay for infrastructure repairs, making a federal-level hike unnecessary.

Doug's Opinion
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12/08/2018
How many times and in how many ways must the American public be taxed?! Congress should be proposing ways to cut taxes, not increase them!!!
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Cathy's Opinion
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12/08/2018
The tax scam of 2018 should be repealed and Oil and gas companies should be charged taxes
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Brian's Opinion
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12/08/2018
A full transparent audit of the Federal Government needs to be conducted and Fraud, Waste, and Abuse needs to be eliminated before honest discussions of increasing revenue through taxation may begin.
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bill Progress


  • Not enacted
    The President has not signed this bill
  • The senate has not voted
  • The house has not voted
      house Committees
      Committee on Ways and Means
    IntroducedMarch 9th, 2017

What is House Bill H.R. 1458?

This bill would increase taxes on gasoline, diesel fuel, and kerosene in 2018 and 2019, with a third tax increase to occur between 2019 and 2029. It would also express the sense of Congress that the gas tax should be repealed and replaced with a more sustainable, stable funding source by 2027.

Specifically, tax rates on different types of motor vehicle fuels would be increased as follows:

  • Gasoline other than aviation gasoline to 26.3 cents per gallon in 2018, 30.3 cents per gallon in 2019, and 33.3 cents per gallon after 2019 and before 2030;

  • Diesel fuel or kerosene to 32.3 cents per gallon in 2018, 36.3 cents per gallon in 2019, and 39.3 cents per gallon after 2019 and before 2029; and

  • Diesel-water fuel emulsion,

The bill would delay the termination of such increased rates from the end of FY2022 to December 31, 2028, and require an adjustment for inflation to such increased rates beginning after 2019.

It would also: 1) increase allocations in the Mass Transit Account of the Highway Trust Fund (HTF) in 2018, 2019, and after 2019; and 2) impose a floor stocks tax on rate increases for gasoline, diesel fuel, and  kerosene (other than aviation-grade kerosene), subject to specified exemptions for exempt uses and low-volume producers.

Impact

Drivers; gasoline; diesel; automobile industry; infrastructure; highways; public transportation; Highway Trust Fund; and the Internal Revenue Code.

Cost of House Bill H.R. 1458

A CBO cost estimate is unavailable.

More Information

In-DepthRep. Earl Blumenauer (D-OR) introduced this bill during Bike to Work Week and Infrastructure Week 2017 as part of a series of bills designed to provide tax dollars and financial support to urban and rural communities, creating family-wage jobs, fighting climate change, and making neighborhoods safe, healthy, and economically secure. This specific bill increases the federal gas tax to catch up with inflation and reflect the importance of fuel efficiency improvements:

“[This bill] would increase the federal gas tax for the first time in 24 years to catch up with inflation and important fuel efficiency improvements. With billions of dollars of unmet transit, road, and bridge maintenance that is costing us time and money, we need a more responsible funding approach than kicking the can down the road.”

Expressing support for a previous iteration of this bill in 2015, Laborers’ International Union of North America (LIUNA) General President Terry O’Sullivan called a gas tax adjustment a “no-brainer”:

“Congressman Blumenauer’s proposal for a modest adjustment to the gas tax is a no-brainer for Americans concerned about road and bridge safety. Every day, Americans pay what amounts to a pothole penalty because of the failure of Congress to fully invest in our nation’s crumbling roads, bridges and transit."

On the other side of the debate, the usually anti-tax and Republican-leaning U.S. Chamber of Commerce has promoted a five cent per gallon per year increase in the federal gas tax over the next five years. Some Congressional Republicans, including Sen. John Thune (R-SD) also support the idea. Sen. Thune floated a gas tax increase in early 2015 as part of a plan to replenish the Highway Trust Fund, and raised the idea again in late 2017 amid reports that the Trump administration was preparing a major infrastructure initiative.

In a meeting with members of Congress in February 2018, President Trump reportedly expressed support for a 25-cent gas and diesel tax increase phased in over five years and dedicating that money to improving roads, highways, and bridges. Sen. Tom Carper (D-DE), who was present in that meeting, said President Trump “came back to the idea of a 25 cent increase several times throughout the meeting” and “even offered to help provide the leadership necessary so that we could do something that has proven difficult in the past.

Bob Lutz, CEO of VLF Automotive, an American-based automotive company and a former vice chairman at General Motors, argues that repairing aging infrastructure is worth the price of gas tax hikes, which are minimal and unlikely to even be noticed by most customers:

“We’ve got the cheapest gasoline in the civilized world. A nickel here or a dime there, with the weekly fluctuations in gasoline prices, nobody’s even going to notice it. A crumbling infrastructure like that, whether it’s roads, bridges or whatever, is a drain on the economy. It causes problems. It slows transportation, [and] it creates accidents.”

Chris Edwards, director of tax policy studies at the Cato Institute, believes that raising the federal gas tax would be “misguided,” and argues that it wouldn’t do much to improve infrastructure:

“98 percent of U.S. streets and highways are owned by state and local governments, and the owners should do the funding. States that need to improve their highways can increase their own gas taxes, sales taxes, issue debt, add user charges, or pursue public-private partnerships. There is no advantage in raising federal highway revenues rather than the states raising their own. The states can tackle their own infrastructure challenges, and about half of them have raised their transportation taxes in the past five years. Supporters of a federal gas tax hike say that the tax has not been raised since 1993, and its real value has been eroded by inflation. That is true. But the federal gas tax rate more than quadrupled between 1983 and 1993 from 4 cents to 18.4 cents, as shown in the chart below. The 4-cent rate would be 9.8 cents in today’s dollars, so the real gas tax rate has risen substantially since the early 1980s… [T]he states have steadily raised their own gas taxes in recent years. API discusses state gas taxes here, and they emailed me data back to 1994. (I’ve interpolated a few missing years). The state average—currently 33 cents—includes both gasoline excise taxes and other taxes on gasoline… Funding for highways and other infrastructure should be handled by state and local governments and the private sector.”

Americans for Tax Reform also and Americans for Prosperity also oppose raising the gas tax, arguing that doing so would hurt middle-income Americans, likely encourage more non-highway related spending, fail to solve the HTF’s deficit, increase the price of consumer goods, and negatively impact economic growth.

This bill has the support of 28 cosponsors, all of whom are Democrats, as well as the support of the American Road & Transportation Builders Association (ARTBA). In previous iterations, it’s had the support of the AFL-CIO, U.S. Chamber of Commerce, AAA, American Trucking Associations, American Society of Civil Engineers, American Road and Transportation Builders Association, American Public Transportation Association, League of American Bicyclists, Transportation for America, and more.


Of NoteIn 2011, the Federal Highway Administration (FHA) estimated that over $70.9 billion in repairs were needed just to maintain safe bridges. Similarly, in 2015, the American Society of Civil Engineers estimated that surface transportation in the U.S. requires over $2 trillion to remain economically competitive by 2020.

Over the 2013-2018 period, over half of states have enacted their own legislation to increase transportation funding by raising their own state gas taxes. From 2010-2018, over 33 states raised their own motor fuel taxes, and some also indexed their gas taxes to inflation so they’ll go up as construction costs rise. Yet other states are trying gas tax alternatives, such as mileage-based user fees, or a tax on vehicle miles traveled that will tax electric and other alternative fuel vehicles that contribute to wear and tear on roads, but don’t use gas.

The Institute on Taxation and Economic Policy (ITEP) notes that, due to inflation and fuel-efficiency gains paired with a near-doubling of highway construction costs from the nineties to 2018, the federal gas tax rate’s purchasing power has fallen by nearly 66 percent.


Media:

Summary by Lorelei Yang

(Photo Credit: iStockphoto.com / MajaMitrovic)

AKA

Raise And Index to Sustainably and Efficiently Invest in Transportation Act of 2017

Official Title

To amend the Internal Revenue Code of 1986 to increase the excise tax on gasoline, diesel, and kerosene fuels.

    It would be more effective to STOP SUBSIDIZING BIG OIL resulting in The US government saving 16 billion annually from leaving the government coffers in the first place. But sure raise taxes. Anything that brings it closer to it’s real cost. Also stop allowing oil exports while we have a net oil trade deficit. It makes zero sense. Oil companies are making 300+ billion dollars profit annually. They don’t need the subsidies. Voilá, money for infrastructure.
    Like (296)
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    How many times and in how many ways must the American public be taxed?! Congress should be proposing ways to cut taxes, not increase them!!!
    Like (155)
    Follow
    Share
    The tax scam of 2018 should be repealed and Oil and gas companies should be charged taxes
    Like (102)
    Follow
    Share
    Leave the Federal FICA Gas Tax Alone..... Gas taxes are regressive and an increase will hurt Americans’ finances between higher prices for gas and consumer goods. States, not the federal government, are the owners of most highways and roads, and over half — 33 — have already increased their own gas taxes in order to pay for infrastructure repairs, making a federal-level hike unnecessary. I’m in agreement that No taxation please without representation....my representative Steve Cohen does not represent his community..... SneakyPete. 4*5*19
    Like (77)
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    A full transparent audit of the Federal Government needs to be conducted and Fraud, Waste, and Abuse needs to be eliminated before honest discussions of increasing revenue through taxation may begin.
    Like (63)
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    Another Democrat socialist solution....raise taxes. SMH, take a look at France to see what raising gas taxes does.
    Like (54)
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    They need to quit passing costs down to the middle and lower class in the name of taxes. Perhaps the big tax break for corporate America is not paying off like it should be.
    Like (53)
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    Money could be used for renewable resources instead... seems like a no brainer
    Like (53)
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    Taxpayers are taxed out. Covering the Executive Orders by #45 is pushing the Middle Class, Working Class and Working Poor, to the very edge of their budgets. This past year we’ve experienced the rich and big corporations increase their bank accounts due to #45’s tax law. GM is just one of several big businesses giving their millions of tax incentive dollars to shower on their top executives and share holders. Many Americans knew trickle down economics didn’t work in the Regan era, and we have proof it has not and will not work now. Need funds for infrastructure? Rescind the catastrophe of the tax law, enforce #45’s appointees to reimburse the monies stolen from taxpayers, (Scott Pruitt, Ben Carson, etc.), and take control of a tariff war that we cannot, will not win!
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    Because of the way it impacts the lower class!
    Like (26)
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    No taking more money out of my pocket will not solve any problems
    Like (25)
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    Decrease wasteful spending, decrease the size of government and get people off welfare and entitlements, BALANCE a BUDGET!!! Maybe lower your own salaries or lifetime pensions!
    Like (23)
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    No, it should not. Need not mention that taxation is theft but WE THE PEOPLE are NOT here for the GOVERNMENTS TAXING PLEASURES. We work and money is already stolen from our paychecks, making it more difficult to survive, we are taxed on our goods, our homes, our cars, everything! Enough IS ENOUGH! we need to lower all taxes to that number of 0! I work 40-50 hours a week not including my second job and I still don't make enough to get by on nearly 8 dollars above minimum wage! THE GOVERNMENT NEEDS TO STEP OFF OF OUR MONEY!
    Like (20)
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    Increase the tax and make sure the proceeds only go to the improvement and maintenance of our road and highways with no funds being siphoned off to non roads or highway projects.
    Like (19)
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    Leave it as is and learn to control the governments spending habits
    Like (18)
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    France can see right through this BS & so can America. These absurd climate change taxes are just fronts for socialist redistribution of wealth policies. Typically I’m not one to label an entire group as stupid, but if you’re socialist, well... not sure why you’d think it would work now, considering it always ends in complete disaster.
    Like (16)
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    NO NO NO NO NO. TAXATION IS THEFT. Do you not see how well gas taxes are doing in France right now?!
    Like (15)
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    Why should we be paying more for gas when the government is just going to blow it on things I don't agree with anyway?
    Like (15)
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    The gas tax is a very regressive form of taxation. We could easily raise more money for road improvement by ending the subsidies that we give to oil and gas companies! A good chunk of the revenue isn’t even used for highways and bridges!
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    You have become too clever in taking our money.
    Like (15)
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