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Archive for Sunday, July 20, 2008

Gas tax won’t take holiday, may rise

July 20, 2008

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— The political vision of a summer gas tax holiday died a quick death in Congress, losing to a view that federal excise taxes on gasoline and diesel fuel will have to go up if they go anywhere.

Despite calls from the presidential campaign trail for a Memorial Day-to-Labor Day tax freeze, lawmakers quickly concluded, with a prod from the construction industry, that having $9 billion less to spend on highways could create a pre-election specter of thousands of lost jobs.

Now, lawmakers quietly are talking about raising fuel taxes by a dime from the current 18.4 cents a gallon on gasoline and 24.3 cents on diesel fuel.

With gas prices setting records daily, Republican presidential hopeful John McCain and former Democratic candidate Hillary Rodham Clinton called for a 90-day suspension of the federal fuel tax to give drivers a little relief at the pump. The fuel taxes go into the Highway Trust Fund, which is used for road construction and repair and mass transit.

Clinton suggested making up for the loss by imposing a windfall profit tax on oil companies, an idea that Republicans rejected. McCain said the money could come out of the general Treasury fund, in effect adding to the federal deficit, and is still getting mileage from the idea.

"Some economists don't think much of my gas tax holiday," he said in a speech this month. "But the American people like it, and so do small business owners."

Barack Obama, the likely Democratic nominee, opposed the idea from the beginning and the White House gave it a cold shoulder. Depriving the 52-year-old Highway Trust Fund of $9 billion at a time when it is heading into the red doomed the notion of a gas tax holiday in Congress.

Comments

Frank Smith 6 years, 5 months ago

Governor Mitch Daniels, that creep, set aside the Indiana gasoline tax a few years ago when prices were at a small fraction of what they are now. It was a disaster for the state, and the oil corporations just boosted their prices to make up the difference.The federal gas tax is only 18 cents a gallon. When Bush invaded Iraq, gas was $1.27, so that was about 15% of the price of gallon. Now it's less than 5% of the cost at the pump. Remember when McBush was a "straight talker?" I listened on C-Span to his "My friends," speech in New Mexico and you couldn't have found a truthful statement with a magnifying gas. He wants to fund highway repairs out of the general fund, so every taxpayer will be equally responsible, according to their incomes, including those who use public transportation, ride bicycles, walk and who choose not to own mammoth RVs and to drive SUVs, etc. Bridges won't just be dropping into the river at Minneapolis. We're already up to our necks in debt to the Chinese to pay for the damned wars and McBush wants to dig us deeper.

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