ATR strongly opposes the current effort to raise the federal gas tax. Raising the gas tax will directly harm middle and low income American families by raising the cost of everyday life. Our lawmakers should not be focused on taxing Americans commuting to work, driving to the grocery store or dropping their kids off at school.
The Federal Government currently taxes gasoline at 18.4 cents per gallon. American drivers pay this tax on top of the state level gas taxes which average an additional 28.68 cents per gallon. In some states, drivers are forced to pay significantly more at the pump. Pennsylvania, for example, has the highest gas tax in the country at 58.7 cents per gallon.
American drivers are forced to pay the federal gas tax despite the fact that 98 percent of all U.S. streets and highways are owned by the states. Raising the gas tax makes little sense given state and local governments have the option to hike their own gas taxes if more infrastructure spending is needed.
In fact, the Highway Trust Fund (HTF) primarily uses the revenue it collects to issue grants back to state and local governments, accounting for nearly one-quarter of public spending on roads. For those following, rather than state governments deciding what infrastructure financing is required, drivers pay both state and federal taxes at the gas pump, the federal government then uses that money to redistribute back amongst the states as it sees fit.
Of course, the federal government does a great job siphoning off money along the way to special projects. Instead of operating as a “user-fee” program to pay for roads, 20 percent of HTF funds are funneled to mass transit programs, that means roughly $8 billion per year for nonhighway use.
A recent report by the Government Accountability Office (GAO) found that more than 50 percent of the HTF spending went to non-road-related projects. For example, $850 million is spent on recreational trails and beautifying streets. HTF funds have even been used on squirrel sanctuaries and to finance driving simulators.
Rather than asking taxpayers to foot the bill for more wasteful spending, Congress should prioritize meaningful reforms to the HTF to end the cycle of wasteful spending on projects unrelated to rebuilding America’s roads and bridges.
Increasing the gas tax will only perpetuate further wasteful spending and will undermine middleclass tax relief gained from passing historic tax reform.