January 04, 2009
The gas tax

I was listening to the podcast version of Car Talk the other day, and towards the end of the show Ray went off on a rant about how we should implement a 50-cent-per-gallon gas tax. You can read what he said here. (Thomas Friedman is also on it.) Basically, he noted that gas was far cheaper now than it had been in recent months, the tax would encourage less driving and incentivize fuel economy, and the revenue collected could be used towards rebuilding infrastructure. He even suggested funding high-speed rail infrastructure with the money, and suggested that was something the Big Three could get into. Click over and see what you think, and check out the discussion that goes with it and is surprisingly non-negative towards the idea.

I don't know what the economic implications of such a tax in a recessionary economy might be, but I do know this: Ray's argument that at least in terms of the price of a gallon of gas there's never been a more opportune time to raise the gas tax works just as well here in Texas as it does nationally. We all know that the gas tax here is woefully inadequate, thanks to the fact that it hasn't been raised since the early 90s. We know we have a large number of unmet transportation needs, even if the only numbers we have are bogus self-serving TxDOT numbers. And we know we need more money for our schools, which get a piece of the state gas tax as well. We could solve an awful lot of problems right here if we embraced even a ten-cent gas take hike, and indexed future increases to inflation, which won't do much to raise it further right now. Naturally, it'll never happen because folks like Rick Perry and David Dewhurst aren't interested in solving these problems, at least not with solutions that have aren't ideologically pre-approved. But if the rest of us care about them, this is what we should be looking at. Who will take up the mantle for this in the Lege? Don't all raise your hands at once.

Posted by Charles Kuffner on January 04, 2009 to Budget ballyhoo

I DO NOT believe that at this time there should be a brand 50 cent new tax on gasoline, however I think the existing tax should be indexed to inflation, in a retroactive way... make the rate of increase of the existing tax faster than inflation for years until it catches up to where it would've been if it has been indexed all along, then reduce the rate of increase back to inflation. But, in case of deflation, do not decrease the case tax. Keep it level no matter what.

Posted by: Peter Wang on January 4, 2009 9:16 AM

I believe President Obama will beat the State to it, and add a national gas tax to fund his infrastructure agenda and other initiatives. This would give the Texas reps an Easy Out not to push for a State tax, even a minuscule one that could keep huge amounts of funds solely within the State.

Posted by: TAN on January 4, 2009 10:06 AM

Rail North Texas is proposing a local-option 10-cent gasoline tax in its package of funding sources for a commuter rail line in the Metroplex. A higher gas tax is a no-brainer, except to the no-brainers.

See also: http://taxvox.taxpolicycenter.org/blog/_archives/2008/12/30/4040181.html

Posted by: David Siegel on January 4, 2009 10:07 AM
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