Whatever your opinion on the healthcare bill recently passed by Congress and signed by President Obama, the passage of it has at least allowed discussions on other important topics to resurface. Topics like energy reform. Details of the Kerry-Grahm-Lieberman energy reform bill have started leaking out. Among the topics that stuck out: a new gas tax.
The details don’t make clear how much this new gas tax would be, but it would likely be linked to the carbon content of the fuel. A higher gas tax has been bandied about for decades, and has always shot down rather quickly. The Fed’s collect 18.4 cents per gallon, while the average state gas tax is about 27 cents. So 45 cents of every gallon already goes to either the Feds or the state, and while it may sound like a lot, in actuality it is amongst the lowest tax rates on fuel in the world. How much higher should it go?
Let us take a look at Europe, which has some of the highest gas taxes in the world. The United Kingdom, for example, charges the equivalent of $3.49 per gallon just in taxes. So add $3 to whatever you are paying for gas right now, and you can get perhaps an idea of what Europe currently pays. But even that may not be enough.
There have been studies that suggest gas would have to cost more than $7 a gallon for there to be a meaningful reduction in miles traveled and car congestion and thus emissions. That kind of tax would cripple our slowly recovering economy, and I’m sure the Senators realize that. So how do they plan to push through a meaningful gas tax, especially after passing a huge new law that is already raising taxes? And where will all that money go? Are we going to get some awesome new highways and public transportation and other innovations? Are they at least going to fix our ancient, crumbling infrastructure?
I’m opposed to a gas tax… but not to the point where I couldn’t be convinced to be for it. I need more details. How much is the proposed tax? How will electric vehicles and the like pay taxes? Do they get a free pass? How will ethanol, diesel, and other fuels be treated? Where will all that money go? Perhaps most importantly though, will it get America off of its oil addiction?
This is going to happen one day America. I’m hoping I just get one more good summer of “low” gas prices before we go all Europe on our cars.