Alabama Taxpayers Better Hold On To Their Wallets. Their Politicians Are Plotting A Gas Tax Hike.

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Posted by Americans for Tax Reform on Friday, December 14th, 2018, 5:56 PM PERMALINK

The Alabama legislature doesn't kick off its 2019 session for another three months, but spending interests are already laying the groundwork for a gas tax increase in the new year. 

"A gas tax of up to 12 cents a gallon has been discussed, but according to Alabama House Majority Leader Nathaniel Ledbetter, the target for a tax increase in Alabama is more likely to be in the six to 10 cent range, which could raise between $180 million and $300 million dollars a year," Dale Jackson reported this week in Yellowhammer News.

Also this week Americans for Tax Reform sent the following letter to Alabama lawmakers encouraging them to reject calls to to raise the gas tax and pointing out that a gas tax hike would claw back the federal tax relief that their constituents received thanks to passage of the Tax Cuts & Jobs Act:

To: Members of the Alabama Senate

From: Americans for Tax Reform

Dear Senator,

With the 2019 legislative session only a few months away, I write to encourage you and your colleagues to use the coming year to enact reforms that will help grow the state economy and protect taxpayers. 

While there are many opportunities to improve Alabama’s tax and regulatory climate, it’s important to first do no harm. As such,  I urge that you reject the aggressive, but misguided push to hike the state gas tax , a proposal that would diminish and, in some cases, could totally erase the relief that your constituents have received from federal tax reform. 

Attempting to impose a regressive tax hike that will do the greatest harm to households who can least afford it is already bad enough. It’s even worse when it has already been documented that existing transportation dollars are not appropriately spent. 

Ballot measures to hike state gas taxes were resoundingly rejected in Missouri, Utah, and Washington State just last month. Between that and the throngs of French citizens now protesting President Emmanuel Macron’s gas tax hike, which he just suspended, it’s clear that gas tax hikes are a political loser, both at home and abroad. 

In addition to being terrible politics, the proposed gas tax increase is also bad policy. Consider that a state gas tax increase would counteract the benefits of federal tax reform and eat into Alabama taxpayers’ federal tax cut savings. This is one of the reasons why Congress has declined to raise the federal gas tax, despite pressure for them to do so; the same sort of misguided pressure that is currently being applied to you and your colleagues. 

To read the letter in its entirety, click here.

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