Posted on July 26, 2011 9:02 AM
Report Proposes New Gas Tax Structure for U.S. Transportation System
Rising costs of construction and operations, coupled with inflation, have significantly undercut the purchasing power of the gas tax. To pay for modernization and maintenance of our transportation system, GO TO 2040 recommends bolstering this tax, as well as using other innovative financing mechanisms.
“Road to Recovery: Transforming America’s Transportation” is a new report from the nonpartisan Leadership Initiative on Transportation Solvency, part of the Carnegie Endowment for International Peace. Among other innovative transportation financing opportunities, the report recommends creating an oil security and price stabilization fee. Billed as "an insurance policy against future oil shocks," it would sometimes be assessed upstream to oil imports and production -- with revenues from the five-percent fee increasing when world oil prices rise above $100 per barrel -- and at other times downstream as a variable gas tax that would increase gradually when oil drops below the $100 threshold. The report states that this fee would help cushion consumers from price fluctuations, while also ensuring stable revenue to support the transportation system.
The report also states: "It is our firm belief that the public will support new petroleum-based taxes and fees. However, the public must have confidence that such taxes and fees will be fairly applied across all potential taxpayers (producers as well as consumers) and that the revenues will be invested to maintain American leadership in the globally competitive economy of the twenty-first century."
A recent public opinion poll conducted by the Mineta Transportation Institute indicates that a majority of Americans would support higher transportation taxes, but only under certain conditions, such as if the increase in taxes went towards specific transportation improvements rather than undefined transportation purposes. For more analysis on this report, check out DC.Streetsblog.org.