While the opinion might be unpopular, there are compelling reasons that the federal government might want to institute an increase in the gas tax. Whenever the price of oil goes up, the politicians declare a gas tax holiday as a means to keep the prices affordable, and to ensure people do not vote them out of office when the next election season rolls around. However, with the drop in oil prices over the past several months, some feel that actually increasing the gas tax could be a smart move.
Why Should They Raise the Gas Tax?
A large part of what pays for the upkeep and improvements to the infrastructure of the United States, including the roadways, is the money gained from the gas tax. Improvements to the infrastructure will help to make the roads safer, and it can help to relieve congestion on the roads. Considering just how much congested roadways cost people in lost time – well over a hundred billion dollars – improving the infrastructure seems like a very good idea. An increase in the gas tax could help to make that happen.
The funding for the highways and mass transit has not seen an increase in more than two decades. Inflation cut the value of what they do get by nearly 40%. Without an increase in the gas tax, there simply is no way to pay for the necessary changes. Since the cost of oil is lower, and the prices at the pump are lower, a modest increase to the tax would likely be low enough that most consumers would not even feel it. They would still have lower overall prices, but the country would have the money it needs in order to improve the roadways.
Even though Congress might not make these changes, states still have the power to increase their own gas taxes and to hitch them to the price of oil. They can then invest that additional revenue into making their own roads safer. One state, Oregon, has an interesting idea they are implementing. It gives car owners a choice of paying the state’s gas tax, or paying a levy on the total miles traveled in the vehicle. This gives the people in the state more choices. It could be a technique other states eventually adopt so long as it is successful.
Though people might not like the idea, an increase the federal gas tax may be inevitable and if structured prudently, it has the potential of benefiting the nation overall.
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