12 July 2010

Gas Taxes Lowest in History

The subsidy of the driver continues. In USA Today:

....drivers will pay less than ever at the pump for upkeep of the nation's roads — just $19 in gas taxes for every 1,000 miles driven, a USA TODAY analysis finds. That's a new low in inflation-adjusted dollars, half what drivers paid in 1975.

....Americans spent just 46 cents on gas taxes for every $100 of income in the first quarter of 2010. That's the lowest rate since the government began keeping track in 1929. By comparison, Americans spent $1.18 in 1970 on gas taxes out of every $100 earned.

Although the federal gas tax — 18.4 cents per gallon — hasn't changed since 1993, tax collections are down because today's vehicles go farther on a gallon of gas, cutting tax collections while increasing wear and tear on highways. Inflation since 1993 has eroded the value of the tax to maintain roads.

"The gas tax isn't going to work as the user fee to finance the highway system in the 21st century," says Robert Poole, transportation policy director at the free-market Reason Foundation...


Joe said...

I definitely support raising the tax ~$0.10 to completely fund highways from user fees. However, I don't think that will change consumer behavior that much as it's really a small subsidy % wise - especially when you take into account that people buy and pay to maintain their own cars (and pay sales tax on this). ...It's certainly nothing like the 60-70% taxpayer subsidies for streetcars.

I agree with that last quote also - I think congestion fees (like London has) will become common here as the tech becomes cheaper.

Radarman said...

Yet the American Petroleum Institute (or whatever) is running new ads featuring "real" working and middle class people tut-tutting about taxing energy and how that wrecks their marginal lives. Harry and Louise live on.

5chw4r7z said...

I think its a shame the extent we subsidize roads and highways. If people had to pay the true cost instead of letting the government do it they'd be screaming.
Did you see the headline this morning? BP will get tax credits worth $10 billion writing off costs of the disaster. So we are still picking up the check.
If nothing else, gas sorced from the gulf should have a disaster recover fee of $1 or so levied on it.

An even better idea would be for the government to get out of the road business and let private companies do it. You want to drive 71, drop some change in the toll booth.
Why should I have to pay for it when I drive on it maybe once a month?

Dave said...

A lot of rural towns Up North are finally seeing their visitors return this summer again since the devastation of the 2008 gas-price-spike.

With the influx of the tourist cash many areas are getting folks off the unemployment rolls, relieving the load on the local food banks and slowing the rate of foreclosures and their negative consequences to the family structure.

There may be a time down the road to reconsider the gas tax but for now its a real chance to prime the pump for better days ahead.

5chw4r7z said...

So what does that tell us Dave besides that those rural towns are unsustainable except with artificially low gas taxes that don't pay for the roads leading there.

Dave said...

Up North we have our share of Ghost towns from the old logging era, but its just as true that a lot of the modern rural economics are based on the 4 seasons not a single industry.

One bad season does not mean an unsustainable ecosystem
but it sure taxes the public welfare services and community chest.