Raise the Federal Gas Tax?

HighwaysJosh Voorhees from Slate just wrote a must-read article on the poor condition of our country’s road infrastructure (18th in the World Economic Forum, behind Saudi Arabia and Luxemburg), and the failure of our leaders on both sides of the aisle to be willing to address a long-term solution: The Solution That Shall Not Be Named.

In particular, Voorhees points out that it is almost universally understood among lawmakers that the current federal gas tax rate of 18.4 cents per gallon of gasoline (24.4 cents per gallon of diesel) is not nearly enough even to keep the federal highway trust fund from going broke, much less actually funding our infrastructure at a level at which repairs and replacements keep up with wear and tear. However, at the same time, almost every legislator (and representative of the executive branch) refuses to exhibit the political will to even publicly consider a desperately needed increase.

Read the article — and then defend the current political cowardice that has led to a nation of crumbling roads and bridges.

Just for a quick recap of the history of our federal gas tax:

  • 1.5 cents, June 1933 (National Industrial Recovery Act, President Hoover)
  • 1 cent, January 1934 (Revenue Act of 1934)
  • 1.5 cents, July 1940
  • 2 cents, November 1951 (Revenue Act of 1951)
  • 3 cents, July 1956 (Highway Revenue Act of 1956)
  • 4 cents, October 1959 (Federal-Aid Highway Act of 1959)
  • 9 cents, April 1983 (Surface Transportation Assistance Act of 1982, President Reagan)
  • 9.1 cents, January 1987 (Superfund Amendments and Reauthorization Act of 1986)
  • 9 cents, September 1990 (Superfund leaking underground storage tanks trust fund achieved its revenue goals)
  • 14.1 cents, December 1990 (Omnibus Budget Reconciliation Act of 1990, President H.W. Bush)
  • 18.4 cents, October 1993 (Omnibus Budget Reconciliation Act of 1993, President Clinton)
  • 18.3 cents, January 1996 (Taxpayer Relief Act of 1997, President Clinton)
  • 18.4 cents, October 1997 (Leaking Underground Storage Tank Trust Fund reinstatement)

Also, to put the federal gas tax in context of the total cost of gasoline, in Indiana, for each gallon purchased, a motorist pays:

  • The retail price of the fuel
  • 7% Indiana gross retail sales tax on the retail price of the fuel
  • 18.4 cents Federal gas tax
  • 18 cents Indiana gas tax

For a little more context on the various taxes on fuel, see my previous blog posts Gas Taxes in Indiana and Gas Taxes in Indiana Part 2.

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