GM CEO Wants Gas Tax Raised to $1 A Gallon


I know it. The government knows it. And so does General Motors CEO Dan Akerson, who joins proponents seeking a higher gas tax. Akerson thinks the tax should be at least $1 a gallon. What do you think?

This isn’t the first time a GM executive has called for a higher gas tax, and Akerson’s reasoning is that a higher gas tax will push more consumers into more fuel efficient cars. Whereas three years ago, when most automakers were still riding the SUV party train, a higher gas tax was completely out of the question, the Detroit Three have completely revamped their lineups to offer more fuel efficient vehicles (well except for Chrysler, which still has a ways to go.)

Given the choice between higher government mandated MPG ratings or a higher gas tax, Akerson and many auto executives would prefer the higher gas tax. I’m not sure consumers feel the same way, though the reality is we are going to end up paying more to get around either way. If government mandated MPG ratings go up to 62 MPG, it will add anywhere from $800 to $10,000 to the cost of a car. Or you bump the federal gas tax, currently at 18.2 cents per gallon (as it has been for the last 20 years) immediately up to 50-cents per gallon, and from there creep it up to $1 per gallon for gasoline. At least that is what Akerson would like to see, and I wouldn’t mind it either, even though the “breaking point” for many Americans is closer to $7 a gallon.

Of course, convincing consumers and politicians that a higher gas tax is what this country needs right now, as we trudge through a “double-dip” recession, is an uphill battle to be sure, and it is unlikely to happen unless President Obama wins reelection, and not one second before then. And even then, such a tax is likely to push many small businesses to the brink of insolvency.

Then again, our much-neglected infrastructure system could really use the money, as could American automakers, who are now offering world-class small cars that are getting better and better fuel efficiency. And as counter-intuitive as it sounds, a higher gas tax means lower economic vulnerability to fluctuations in crude oil prices. Like Akerson, I believe that was as a country really need to weigh the costs versus the benefits of our cheap gas prices. Of course, this requires having a “grown up” conversation in Washington D.C., and I don’t see that happening until after the next election.

So let me ask you readers, how high do you think the gas tax should be? Is $1 a gallon too much, not enough, or just right?

Source: Detroit News

Chris DeMorro is a writer and gearhead who loves all things automotive, from hybrids to HEMIs. You can read about his slow descent into madness at Sublime Burnout or follow his non-nonsensical ramblings on Twitter @harshcougar.

About the Author

A writer and gearhead who loves all things automotive, from hybrids to HEMIs, can be found wrenching or writing- or else, he’s running, because he’s one of those crazy people who gets enjoyment from running insane distances.

  • I’d be all for a gas tax as long as there was a decrease in SS/Medicare taxes (that ensures everyone who works gets the break) to make up for it. In other words, it’s just a tax shift from taxing your pay to taxing your consumption. That would not only provide an incentive for people to conserve fuel, but would also incentivize working.

  • Yeah $1 a gallon would work alright right after GM repays the TARP money they “borrowed” makes the cars they sell no more than $10k and as far as the government weighing in on anything, until they can clean their own house up, they shouldn’t mess with mine let alone my wallet…

  • General Motors CEO Dan Akerson is nothing more then an idiot . We all know that he never cared about the price at the pump or the quality of his junk cars and for him to ask for a tax increase it’s just another BS that we got used to it .
    This lunatic needs to step down and apologize for his stupid idea-he’s nothing more than an IDIOT
    Come up with options like in Europe so people will have alternatives and then hike the tax but NO-greed and incompetence is the main word here
    This country is going down the toilet with idiots like General Motors CEO Dan Akerson
    As for the author to consider that America needs a new tax hike proves that he’s out of touch with what’s happening here

    • @ Jaga

      I’m afraid you’re the one “out of touch” with reality.

      The reality is that America’s infrastructure is about $2 TRILLION (with a T) in the hole. There is not enough money coming in from the gas tax (which was last raised 20 years ago) to cover even the most basic maintenance needs, nevermind building new bridges and roads. The United States has the lowest gas tax among developed nations, and while that may have worked in the past, our country needs to spend money to replace and save our roads. Otherwise, the cost of gas will be a moot point, because we won’t have any roads to drive on.

      I will agree that Akerson’s comments are rather selfish; he wants a higher gas tax to sell more cars. I want a higher gas tax to fix our roads and expand our transit options. Keeping the gas tax low is hurting Americans, not helping them, and for the average consumer you’re talking about a few hundred dollars extra a year. Businesses will obviously feel the hurt more, but it will give them an incentive to streamline their vehicle fleets and purchase more fuel efficient vehicles…which would have been saving them money in the first place.

      • I’ll go along with a tax hike when the government sheds all of it’s waste, corruption, demagogery, and audacity, and accepts responsibility for it’s actions…..until then, when H*** freezes over !

      • I think you’re right on target. There are those who wail and whine about taxes, but they must not realize that the rest of the world pays more taxes than we do and they’re doing ok.

        What’s going to cost more, you paying $0.85 more per gallon, or replacing tires constantly due to potholes and poor roads? Hell, even if it breaks even, I’d rather not have to deal with the latter situation.

        Not to mention, even WITH a $1 p/g tax, we’d still be paying less for gas than pretty much anywhere else. People here have it so good but all they do is whine, sigh

      • I agree. I have large saving account.I am sick and tired of getting stuck in traffic.If gas was 10$ I woundn’t notice. Many time I see real rusty clunckers and think how can you afford gas and why the heck would you want to go anywhere? So yes keep the white trash off the road. double the cost and get half traffic.

  • I will park my truck and ride public transportation before I pay another $1.00 for a gasoline tax just so that GM can sell smaller cars. I’m getting really tired of the US government telling me what I need to eat, what I need to drive, what I can say and what I can’t, etc. If GM can’t sell there products now, perhaps they should think about LOWERING THE PRICE of the inventory they already have!

    • Wouldn’t that be the point of the tax increase? More people would ride public transportation. More people would buy cars with higher fuel efficiencies. It would force this country in the direction it needs to go in. A direction we won’t willing choose while gas is cheap.

      • ‘Force’ this country?……what socialist camp were you weaned in? Look at what is going on in Europe where they have had ridiculously high fuel prices for DECADES ( currentl;y about $8.40/US gal in England…..) what has been their benefit/…..a government ploy to simply suck more out of your pocket….meanwhile the likes of Akerson have ‘bennies’ that allow then to drive cost free. How is that ‘good’ for the rest of us?. Please show me a European government that is stronger, financially, since they’ve invoked these taxes…… ANY money to the government is a sure way of having a direct role in flushing the $$$$$ down a toilet. We have all seen the ‘efficiency’ of government spending, especially after WWII. We need to get the GOVERNMENTS house in order first…..return accountability and responsibility to Washington, not add sky-high platitudes to the vernacular already spewing from our politicians who have been feeding at the public trough for years ( decades for many ).

        • I like how you mention ww2 Europe and England in particular. If we look at oil producing countries tend to have the lowest gas prices, and here in the US our government is painfully slow to adapt(like having congressmen and senators that cant use email as an example).

          For ww2 well we fought there we won and in the end we as a nation made a lot of money. In Europe everything was destroyed we helped them rebuild everything no fighting during ww2 happened in the main 48 states, we were untouched.
          During this time there was no real middle east oil the US was the Saudi Arabia of the world then the US moved into and past peak oil for the US, this was about the 70s. Roll us up to today, we import more that 60% of our oil, but we have folks in gov that still see us as the big oil pumpers especially in Texas we not to long ago had a football team called the oilers. So our painfully slow gov needs to play catch up with the world.
          Higher gas taxes helps us to see that maybe we should be using less gas and it helps us send less dollars out of the country. money leaving the country that could be spent by us in our country. I have seen in less than 20 years going from less than $1 to $4 gas.

          Either way we will have to pay more for gas and/or cars. At least with the tax I can have a road to drive them on. Do I think the GM CEO is an idiot and a D-bag you bet, but I do think we need an upping in the gas tax. So if we bump the tax by the proposed 81.8 cents, that money with go to the gov, some go that money will go to the roads it is supposed to go to, and in theory help protect us and our economy from being hurt by rising oil prices, or when the gas price goes up all on its own we can watch that money leave the country.

  • That plans is absolutely idiotic and not even remotely well thought out by the CEO or anyone that agrees with it.

    So, my Hemi Magnum that’s more than half way paid off would become too expensive to drive, but I also couldn’t I sell it because most others couldn’t afford to drive it either, therefore by design, this tax would force me to now purchase…say a brand new Chevy Volt for 4 times what I owe on my Magnum and continuing paying on the Magnum as well so as not to destroy my credit, and even after now being in this big of a financial hole, I’d still have to buy gas at $1 more than it is now.

    Also too, and this will obviously come as a shock two the writer, but commuters are not the only people that need gas. Trucking companies, airlines etc also do, but I guess they could just replace their trucks and airplanes with Chevy Volts also. Now, factor the increase in food and all other goods that are transported, and your cute little $1 tax is now costing people thousands of dollars a year, and for what?

    So the Government can have billions of extra dollars a year to blow on non-sense, and I can be forced into a car I have no desire to own, and be completely broke in the process? Yeah, great plan you have. Why stop at a dollar, just add a $10 tax on gas. If $1 extra is really good, $10 has to be fantastic.

    • “So the Government can have billions of extra dollars a year to blow on non-sense, and I can be forced into a car I have no desire to own, and be completely broke in the process?”

      The alternative of raising CAFE standards (which is what Akerson was comparing to) would have similar results. Choose your poison.

    • Steve said “So, my Hemi Magnum that’s more than half way paid off would become too expensive to drive”

      So you are saying that when you bought your Hemi Magnum, you didn’t see high gas prices coming, and you failed to plan for the future? And therefore, the entire nation has to pander to your failures?

      Did you buy it BEFORE the summer gas price spike in 2005?
      Did you buy it BEFORE the summer gas price spike in 2006?
      Did you buy it BEFORE the summer gas price spike in 2007?
      Did you buy it BEFORE the summer gas price Crisis in 2008?

      How long is your loan term? 10 years?

      If you didn’t see the pattern, and you bought a gas guzzling Hemi Magnum anyways, you only have yourself to blame. You shouldn’t have had the V-8.

  • My last five autos have been Cadillacs. I have bought my last Government Motors (GM) car, regardless of the price of gasoline. This is why GM is doing so poorly. – The management can’t make it on their own. Does Akerson have any concern about the impact that a dollar per gallon would have on the economy?? Why don’t he build a more fuel efficient vehicle that the public could afford and would want to buy? I am convinced that foreign auto makers will kill GM in the US market for fuel efficient autos. Also, if I were a millionaire I probably wouldn’t care about the price of gas either. Go Ford!!!

    • @ Bill Anderson

      So posting consecutive profitable quarters and gaining market share is what you would call doing poorly? GM has made more than its fair share of mistakes, and they aren’t out of the woods yet, but neither are they doing “poorly” right now.

      Akerson is simply saying what everyone in the auto industry already knows; if they want to sell small, fuel-efficient cars, gas prices must increase.

      BTW, Chevy Cruze Eco: 42 MPG highway, starts at under $20,000.

  • Horrible idea. Cost of EVERYTHING increases. How do people with what seems a complete lack of common sense become a CEO of GM? I pledge to never buy a GM again. Though to be honest I haven’t bought one for over 5 years. They’ve made junk for a long time now.

  • The idea that the whole US economy can be tipped over if it doesn’t have the developed worlds cheapest (by far) gasoline is ludicrous.
    I guarantee that “P.Tucker” above will not be parking his truck just as every other nation has discovered previously when they long ago left US priced gasoline way behind them.
    Leaving aside the question of whether or not we should cut our oil usage, the US infrastructure needs the money. Very badly. Much more of a collapse in that and “P Tucker” will HAVE to park his truck – and there won’t even be an alternative. And that would wreck the economy.

  • jb

    your idea of add’l gas tax for pot holes is like more tobacco tax for lung cancer patients, or alcohol tax for treatment centers!! If govco’s taxation of tobacco/alcohol was for health reasons then, after 50++ years of everincreasing taxes, there would be no alcoholics or lung cancer patients!!! Govco gets enough tax money!! If you want the pot holes fixed take it out of existing $10/pack and $20/bottle cigarette/bourbon prices!!! $1/gal add’l gas tax would go the same place 50% of all govco revenue goes….down some politicians/beaureaucrats rat hole !! jb

  • From a climate change perspective, the more ways we add incentives to go highly fuel efficient, and to make renewable energies cost effective – and the quicker we do so – the better. The epidemic of recent climate disasters throughout the American South and Mid-West are the clearest evidence yet that our climate crisis is already upon us, and much quicker than climate scientists had been predicting. Dramatic changes are needed in how we use energy if we are to have a future at all. Nothing would move us in that direction quicker than an immediate and significant tax on gasoline. Much of the resulting shift would fall to American automakers, who are finally well positioned to benefit from such a shift.

    • Yes Kurt, and the sky is falling………..

  • Or we could stop subsidizing the oil industry. This would SAVE taxpayers money while essentially achieving the same goal. $77,000,000,000/310,000,000 people in US = $248 per person per year!

    • Except that the industry would just raise their prices by the same amount. Remember, corporations don’t pay taxes, their customers do. I agree we should stop subsidizing industries (all of them), but it will result in higher prices.

      • That was his point. Instead of saying ‘Here oil companies, keep that money, we don’t need it.’ (turns around) ‘Hey little guy, we need money, let’s increase your gas tax to $1. Don’t worry, it’s going to a good cause.’ they could charge them the same as anybody else at the source, reap the increased revenue that the writer believes would come with higher taxes, and if that raises gas prices then there you go – you’ve accomplished what GM’s CEO wants.

  • Taxes are not an incentive to manipulate public behavior, they are a toll to cover costs.

    This kind of manipulation would offend me no end, in this case I would never EVER buy anything made by GM or affiliates and would actively discourage others from doing so. This idiot is simply trying to get the government, once again, to do his bidding and create an economic playground that benefits his corporate strategies.

    Stop trying to build the house of cards even taller and find out how things really ought to work, not be incentivized.

    • His point was that you’re going to pay one way or the other. If the gov’t raises the CAFE standards, cars will cost more and you’ll be forcing manufacturers to make cars that people don’t want. Large SUVs may disappear entirely (or be sold at prices only the very rich could afford).

      Raising the gas tax would accomplish the goal of raising the U.S. fleet average fuel economy while giving the people the option of choosing to be fuel efficient or not.

      If I live 2 miles from work, why shouldn’t I be able to drive a Suburban if I can afford one. New CAFE standards would make that not even an option. With a higher gas tax, I am free to choose, limited only by my own resources.

  • I am all for increasing gas taxes. The way we do it is very important. Gradually increase the tax over 5 years. What that does is it gives people time to adjust. If you know that gas prices are going to be higher in the future you will buy your next car with that in mind. Make the total increase higher than $1 but the annual increase small enough that it does not shock the economy.

    • Whatever else the government does with gas tax, they need to convert it from $/gallon to a Percentage like other taxes. Otherwise inflation eat away at this revenue source over time, which is exactly what got us into this mess in the first place.
      18.2cent/gallon was a high tax when it was put in place. But inflation has made it be relatively small.

    • We should get it to the dollar first and then see where we need to take it. for the 5 years thing I agree say bump it up the $0.32 to $0.50 no and then $0.10 a year for the next 5 years.
      So with $3 gas right now that $0.32 is just over 10% if you get 20mpg in your truck you just have to get 22mpg, you can almost get that from changing driving habits, or you can drive the same and just stop crying over paying $6.50 more for 20 gallons of gas. $6.50 is like 2 starbucks coffees, or a up-sized fast food meal. Giving up 2 cups of coffee to not have a bridge fall and kill me in traffic sounds like a bargain.

  • Last thing we need is more tax, all that will happen, they sell less gallons, they slow production, hence causing artificial inflation, driving the cost back up

  • Of course Akerson proposes a higher gass tax…..that idiot, and other ‘thinkers’ like himdon’t even pay for the stuff they burn now….it’s all a part of their ‘benefits package’ that comes with the executive vehicle priviledges. I wonder just how enthusiastic these ‘leaders would be if they wern’t getting ( notice I did NOT say ‘earning’ ) millions per year and had to go thru life at an ‘everymans’ wage …….bet the story would change-FAST !

  • They wouldn’t have to tax gas. They’d just have to remove the government subsidy keeping gas at a low price. Then the government wouldn’t spend tax money to make tax money, which seems counterintuitive to me anyways.

  • The problem is not, and has never been the amount of money the U.S. Government collects in the form of taxes, it’s the ridiculous amount of money the U.S. Government spends and wastes that is the problem.

  • I think raising gas taxes is a good idea, but only in proportion to the number of high MPG and EV’s available in the market.

    It’s good and all to use both the carrot and the stick as incentives to drive vehicles that burn less gas or diesel. But it doesn’t do any good if the cars aren’t available to buy. Then it just becomes a punitive tax, not an incentive.

    It’s a chicken-or-the-egg kind of problem. The solution is to phase in higher gas taxes tied to something like CAFE standards.

  • Set the tax at $3.185 per gallon. Earmark half of it to support education at all levels. Use the rest to support public transportation. Except of course the .185. Let it do whatever it is doing now.

    Some people get screwed but the end result will be more fuel effecient cars, more people taking the bus and trains, better educated workforce, and lower dependence on imported oil.

    • @ Tim

      While I am all for a higher gas tax, $3.185 a gallon is way too high right now given the economic situation. $1 a gallon would result in about an extra $500 a year in gas taxes; you’re talking about an extra $1,500 a year. And I strongly disagree about sending the money to education at a time when our infrastructure is in dire need of repair. The gas tax should be used explicitly for maintaining and building America’s infrastructure.

  • I guess I’ll be looking to the fine folks at Ford or Toyota when purchasing my next car! I can barely buy gas now so a $1 per gallon gas tax would affect me severely. I have to agree that this guy doesn’t give a hoot about the consumer or their dependence on foreign oil. Evidently he is from another planet with ideas like this. I vote that GM will NEVER be allowed another government bailout.

  • Boycott GM and buy Ford!

    Gas tax is the wrong way for a free market nation to encourage higher gas mileage.

    Once we get to those GM electric cars the gate will swing shut on the wild pigs (Google “How to catch wild pigs”) and taxation of either the miles driven or electricity will be invoked.

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