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Usually, when we talk about a gas tax around these parts, it's because someone – the CEO of Ford, maybe, or just us – brings it up as a way to create demand for more fuel efficient vehicles. A higher gas tax could also help fix the national infrastructure while it makes people think twice about ignoring vehicle running costs.

So, we may talk about the gas tax more than the average American, but how much do we really know about the tax as it's implemented today? According to a poll conducted last year by Building America's Future, Public Opinion Strategies, and Greenberg Quinlan Rosner Research, we don't know a whole heck of a lot. Think you know better? Answer the question below and then follow us past the jump to see if you "know" as much as most Americans about the gas tax.

When was the U.S. national gas tax last raised?
It's automatically raised every year 366 (12.0%)
2004 229 (7.5%)
1999 157 (5.1%)
1998 138 (4.5%)
1993 443 (14.5%)
1985 576 (18.8%)
1973 1151 (37.6%)


[Source: Infrastructurist | Image: El Caganer - C.C. License 2.0]

If you answered that the tax is raised automatically each year, you're like 60 percent of Americans (from both major political parties, from all around the country). The correct answer, though, is that the feds have been taking just 18.4 cents of each gallon since 1993. As Infrastructurist put it, "in a colossal error of judgment, the government neglected to index it for inflation. So it's worth even less now than it was then." Before we think about the tax in the future, don't you think we need to understand the past?


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  • 68 Comments
      • 5 Years Ago
      The price American pay for fuel doesn't even cover all that is required to get it here (if imported, which a significant portion is). We're *just* paying higher Fed. income taxes than is actually necessary, irrespective of whether we buy petroleum or not.

      Oil importers should pay for the delivery-route protection services currently provided by the US .mil at taxpayer expense of hundreds of billions/yr. Alternatively, they can hire their own mercenaries. No free market cheer-leader should find a reason to disagree with the removal of a subsidy of this nature. It's a cost of business that the consumer
      should rightly bear and that will lead to a rational demand for more efficient vehicles. The current model is one rife with cost externalization and thus distorts the market.

      The solution is quite simple. Cut Fed. Income Taxes that feed the DoD by the same amount that fuel taxes are raised. That sort of revenue neutral shift should please anyone who's interested in honest accounting. Would it shock some people into realizing how much they subsidize people who use a lot more fuel than necessary?
      You bet!
      • 5 Years Ago
      Why make it so direct? Why not a tax on all imported fossil fuel sources. Not just gas, but oil, propane, natural gas, coal, etc. This will have lots of effects-- higher gas prices, higher natural gas prices, higher commodity food prices.

      This will encourage energy conservation across the spectrum, and raise prices of commodity corn, HFCS, fuel oil, etc. It will encourage the development of fossil fuel alternatives such as ethanol, biodiesel, wood, etc.

      The government could give back some of that with rebates on insulation, fuel efficient cars, CFL's, solar power, wind power, etc.

      The end effect would be a nation that was a lot less dependent on OPEC.
        • 5 Years Ago
        Your target is good and your strategy sounds good at first but there are multiple fatal flaws.

        First, oil is fungible and a globally traded commodity. Even though we don't trade with Iran, every drop we buy wherever the source enriches Iran anyway, because it makes oil that much more scarce that year, and enables Iran to charge that much more for the oil it sells its customers. The same dynamic will be at play if we tax or ban oil from Saudi Arabia, etc.

        Second, while we have 25% of world oil demand, we have only 3% of world oil reserves, and the Mideast has over 70% (and that doesn't count non-Mideastern OPEC members like Nigeria and Venezuela). OPEC is expending its oil at a slower rate than the non-OPEC world. If current rates and policies continue, by 2020 OPEC will have 80% of what's left and we'll have less than 1% (and that's without tapping offshore or ANWR; if we do our share of what's left declines even faster).

        Third, OPEC not only has the world's deepest wells, it has by far the world's best, easiest to get to, and cheapest stuff. Our oil is significantly more inconvenient to access and/or more expensive. So taxing OPEC oil will not simply cause a shift to non-OPEC and/or domestic oil without a price hiccup; instead prices overall will skyrocket; an effect you seemed to want to avoid.

        Fourth, even if somehow we could get the whole world to use less oil overall and thus our denying ourselves OPEC oil actually resulted in lower sales for them, they could just slash production to match, spike the per-unit price, and make just as much as before on reduced sales volume. So the madrassas, radical mosques, "schools", sat TV channels, websites, training camps, armored vehicle piercing bomb factories, and nuclear weapons programs keep right on rolling without a blip.

        The only solution is to get off oil, any oil, regardless of the source.
      • 5 Years Ago
      This site has some of the stupidest comments on politics, taxes and government of any site I've seen. I've seen more cogent economic discussions on bodybuilding forums.

      I guess many environmentalists truly are wackos.
        • 5 Years Ago
        Any dissent from the FAR left policies espoused by the "caring armchair Progressive intellectuals" here on ABG will only be rewarded with personal attacks.

        That's all the progressives have. Well, that, gov't guns, taxes, regulation, poverty and ultimately genocide....

        Socialism wasn't sellable to the American people so they called themselves Progressives. Progressives were discovered to be socialists, so they started calling themselves Liberals.

        A pile of crap is a pile of crap even when you call it fertilizer! ALL the great mass killers (Stalin, Mao, Hitler, Kim, Che, etc.) were Progressive-Socialists.

        They would rather have you starve than drive a car to get to work.

        Know you enemy and know that they HATE your freedom!
        • 5 Years Ago
        Tim, even in the age of the gold standard, in this country and many others, there was rampant inflation, financial panics and ruinous crashes far more frequent and severe than in ourso-called fiat era, taxation, regulation, and everything you rail against.

        So clearly, it does NOT begin and end with the bogeyman of "fiat currency".
        • 5 Years Ago
        Poor Yorik.
        • 5 Years Ago
        Also, Tim, not EVERY issue = genocide. If every slippery slope slipped all the way, every government everywhere would have killed everyone under its jurisdiction by now and humanity would be extinct.

        There are sub-genocidal levels of badness. Really. You can say, "I disapprove of this public policy" without shrieking, "this is equal to genocide!"

        Try it. Maybe then, you will convince one person. Maybe. Right now, all your posts, all that typing an effort, have zero influence because you overstate your case to the maximum possible degree that any case can be overstated, with the possible exception of claiming that a given policy will destroy the entire universe.
        • 5 Years Ago
        The entire problem starts and ends with the Fed and Fiat Currency:

        Fiat Empire - The Federal Reserve is Unconstitutional (1 of 6)
        http://www.youtube.com/watch?v=88vUf9Kc-Go&feature=rec-r2-2r-7-HM
      mgb3939
      • 5 Years Ago
      Let's be honest- last winter would have been the perfect time to raise the gas tax a good 40 to 75 cents a gallon, after prices collapsed. Retail prices would only be slightly higher now, the difference is that the money would stay in America instead of going overseas. Why don't people think?
      • 5 Years Ago
      Be gratefull about gas prices, in the UK we are paying (crap math time) $7.95 a gallon becuase the UK Goverment tax it THEN put VAT (value added Tax) onto the whole thing so 60% of the price of fuel is going to the government
        • 4 Months Ago
        Wow - and yet somehow Britons are not tooling around in EVs and hydrogen cars? Maybe they're just forced to pay more for fuel and have less for other needs for their families?

        Attention US readers - maybe what I've been saying over and over here on ABG, that merely increasing the price will not be effective in getting us off oil, is correct.

        What counts is to get cars out there that are alternative fuel compatible, and the easiest way to do that is to mandate that gasoline cars be flex fueled from now on.
        • 4 Months Ago
        No, but in discussions about total cost of ownership of BEVs and REEVs it doesn't usually come up too favourable in the US, but in the UK and Europe it's likely to be a different matter. We're not driving Battery or Hydrogen cars in the UK because they're not really any available to buy, or at least not any good ones. Unlike the Prius a plug-in hybrid or BEV should quite easily result in lower total cost of ownership in the UK. If GM manage to release the Vauxhall Ampera for £20k (about the same as a base Prius) they should do very well!
      • 5 Years Ago
      Sorry RickyBobby, I only read 1st paragraph of your comment...
      ----------------------------------------------------------------------------------------------

      A $1 Gas Tax is the Fair Way to Pay for Basic Health Care Programs

      I love my little car, but we in the USA are addicted to driving. We own 200 million cars, drive 3 trillion miles, and guzzle 200 billion gallons of fuels each year. We hardly take mass transit, or walk or bike anywhere. This contributes to laziness, obesity, fast food diets, stress, suburban sprawl, water shortages, car accidents, traffic congestion, air-pollution, greenhouse gases (GHG), global warming, and conflicts in the Middle-East. Obesity and diabetes is related to 9% of Health Care (HC) costs. According to the World Health organization, hundreds of thousands of Americans get sick from auto-related pollution, many die. Our lifestyle and health are clearly interconnected.

      Support financing Basic Health Care (BHC) with an easy to collect $1gal tax on fuels and energy. That will raise $500billion/yr to wean us from an unhealthy “automobile addiction”. BHC in this case means a Federal program of matching grants to non-profit HC providers. It is not an insurance plan.

      The $1gal gas tax is not regressive if we give each taxpayer a $500 year rebate for baseline energy needs (or state issued 'gas cards'), and we get BHC.

      This will lower GHG too, improving our health, and paying for both. Then there will be no need then for a large "Cap and Trade" program. You see, “everything is connected to everything else”. Have you noticed that countries with higher gas taxes also have the healthiest people?
      ---------------------------------------------------------------------------------------------------
      SUMMARY: “Win-Win” aid to our auto industry will require: A $1gallon Federal gas tax to prevent auto industry collapse and promote new transportation modes, temporary suspension of some EPA, DOT, and NHTSA regulations for cars rated 40 plus MPG highway or more, a $1000 Social Security deposit for buyers of USA made cars rated 37mpg or more, and a $1000 instant rebate for any vehicle rated 29 plus MPG highway or more. Sell GM or Chrysler to the employees via stock buyout in lieu of some wages. They may opt into a parallel basic health care program for all in those MI cities. We will encourage Americans and business to plan and save by deterring solicitations for “Easy Credit”. $10 billion dollars will be awarded to 3 winning plans for a 100mpg car.


      Nov 18, 2008
      Dear Senator Cantwell,

      Below is a letter I wrote in May 2007 to John Dingell and the Committee on Energy and Commerce. I suggested Congress temporarily suspend EPA, NHTSA, and DOT testing of tiny fuel efficient cars, and counter balance that with a $1 per gallon gas tax. More recently in a letter below that, I've altered the proposal to include support for the Michigan auto industry via a trial plan in that state for Basic Health Care, employee ownership of failing auto company stock at current low prices, restructuring of their contracts, pension terms, health insurance, other benefits and a $10 billion competition for the Big Three to develop a 100mpg commuter car, along the lines of the current Automotive X-Prize. The $1 gallon gas tax will pay for these "Win-Win" policies.
      ---------------------------------------------------------------------------------------------------------------

      harlanx6
      • 5 Years Ago
      The non US contributors of course think we should be more heavily taxed like they are, but most of us are against raising taxes as an incentive to drive behavior of any kind, and we are prepared to vote anyone in government who advocates helping themselves to more of our property out on their ass in the next election. It's a powerful incentive for a politician.
        • 5 Years Ago
        @harlanx6
        dsuupr, that is exactly why you can preen about your compassion for others, because you can afford to pay high taxes. The rest of us can't. And the economy can't afford the diversion of capital into government and away from where it could be expanding business, hiring new people, and innovating.
        harlanx6
        • 5 Years Ago
        @harlanx6
        A government who takes 99% will soon be taking 100%
        • 5 Years Ago
        @harlanx6
        Give unto Ceasar what is his.

        My name isn't not on the dollar bill, therefore it doesn't belong to me. If it wasn't for the same government you don't want to help, you wouldn't have the education for you or your kids, the safety of a great military, great roads . . .

        As long as I live better than 95% of the world, which 99% of American do, why do I care if they take 99% of my money in "taxes". It is the ability to choose what I want to do and not have some one track my calls, kill my fellow Americans and try to scare me into a war that really affects my health and daily life.
        • 5 Years Ago
        @harlanx6
        BTW: my wife and I do make over six digits plus have two homes. Our taxes are more than most people I know.
      • 5 Years Ago
      Let's see... beak out the 'ole numberator:

      We know that inflation is somewhere around 2.5% per year. Surely it varies year to year and is not precisely 2.5%, but let's assume that's the average. 1993 was 17 years ago, so it follows that:

      $0.184 x 1.025^17 = $0.28

      The gas tax should be around 28 cents today... if we wanted to keep with the times.
      • 5 Years Ago
      Why do Progressive-Socialists ALWAYS want to tax and spend? If you WANT to spend, then YOU donate. Don't FORCE ME to you liberal pinko commies!

      Then again, we all know that to you pinko commies think that stealing from others and bending them to you will at the point of the a Gov't GUN is progressive. And yet you have the nerve to call yourselves "liberals" when you are ANYTHING BUT LIBERAL!

      It's like calling that socialists Hitler or mass murder Stalin saints. LIARS!

      Socialism is NOT progress!
        • 5 Years Ago
        @Tim: Tell you what. I won't make you pay my (suggested) $1/gal gas tax, if in exchange I don't have to pay for the Iraq War, mmm-kay? The cost of that war could've offset everyone's gas taxes for many years to come.
        • 5 Years Ago
        How did you like the progress during the Bush administration. "ie" No increase in the middle class income and approx. 20% decrease in your stock portfolio for 10 years. It's been great watching the rich get richer under the free market conservatives, if you like that sort of thing.
        • 5 Years Ago
        Don't go there, it was your Republican Supreme Court that just voted for One World Government, by allowing Corporations [ Foreign included ] to buy the politicians they want in office. They just kissed your Democracy goodbye.

        Expect to see Chinese and OPEC money, Fox is already Arab owned, to throw elections to more "Free Trade" candidates and sell out the rest of the US to China and OPEC.

        Any gas tax can be returned back to the voter in your income tax. There's Global Warming and Peak Oil occurring, the issue isn't to raise taxes just for the Fun of It, but to SOLVE PROBLEMS.
        • 5 Years Ago
        Wow, you drank the whole cup of Capitalist Koolaid didn't you.

        Since you don't want government doing anything for you, when your house IS burning down you are not allowed to call the fire department. When you get mugged you are not allowed to seek out a cop. You cannot drive on ANY of the roads that my taxes have helped to pave - taxes that I don't love but gladly pay so that we can live in a better country than the third world crap holes that your fasc1st right wing heroes are trying to turn America into!
        • 5 Years Ago
        @Tim

        Did you forget Caps Lock on your post?

        Please take your medications and chill out a bit, high blood pressure caused by anxiety isn't good for you.

        And when your'e a bit more chemically balanced you might also understand the difference between Dictators and a discussion about fiscal matters. God bless you!
        • 5 Years Ago
        To call Hilter a socialist is a misunderstanding of history, and Stalin was a proto-capitalist who created not communism but a plutocracy (kind of like we are getting in the U.S.). Of course we can never question the Randan ideas of selfishness that makes the poorer poorer and the richer richer. Because of the idiot ideas of conservatives and their willingness to overspend on the military industrial complex, we waist billions a year in productivity because of delays at airports, sitting in traffic, and waiting for new bridges to be built because one collapsed. If you don't want your taxes to go up, fine, so reduce spending on the wasteful military from 700 billion to 300 billion. What is even more interesting is that the super rich, Bill Gates and Warren Buffett, ask to pay more in taxes. I would rather pay the taxes in Sweden or France and get what they have instead of the almost-as-high-taxes in the US and get nothing but a military.
        • 5 Years Ago
        When was the last time a "Republican" balanced Any Budget?
        Where were the "Tea Baggers" for the last 8 years? Republicans run up a 13 Trillion Dollar Deficit and NOW you start to complain. Did you think Magic Fairy's were going to pay for the Iraq War?
        • 5 Years Ago
        Nice Tim! But after you get done watching Fox News, can you please come back to reality?

        It's not about taxing and spending just to tax and spend. It's about keeping a 15 trillion dollar economy running smoothly so we don't have an economic recession (kind of like the one we're going through right now).

        Yeah we can continue to cut taxes and pretend that everything is okay, but unless we as Americans finally get real with ourselves and realize that we can't continue on the path we're currently on we'll be setting ourselves and our country up for failure.

        A few cents more per gallon won't be too noticable for us individually, but it'll really help our country long term. We'll use less foreign oil, have cleaner air, and we'll close our trade deficit gap. Try reading the book "Comeback America" for more insight on this.

        In the meantime, try turning off Sean Hannity and start thinking for yourself.
        • 5 Years Ago
        Maybe we should get rid of the gas tax and have private ownership of roads with tolls on them all? That's the "free market" economy right? We don't need some government "stealing" our money to fund infrastructure. Think of all those "great" "free market societies" that don't have governments "stealing at gunpoint" our money to pay for infrastructure. OH THATS RIGHT THERE AREN'T ANY. GO AWAY YOU NEO-CON IDIOT!
      • 5 Years Ago
      Bogus poll. Where can we check:

      [ ] Not long enough. We're already overtaxed. It's getting hard to feed our children.
        • 5 Years Ago
        We can't trust Congress to handle our money responsibly, so we have to fight any further national gas tax hikes.

        Admittedly, I always thought the demand for gasoline was inelastic until I saw miles driven fall off after gas went above $3.50/gallon. So it would be nice to hike the tax, cut oil demand while watching OPEC suffer the lost revenues. But let's face it we would be buying bridges to nowhere rather than genuinely improving infrastructure or even paying down debt.
        • 5 Years Ago
        What, in your *gas tax*?

        Take the number of miles you drove last year, divide by your car's combined mileage, and multiply it by your state's gas tax ( http://en.wikipedia.org/wiki/Fuel_taxes_in_the_United_States). If I take the averages for that number (10000 miles, 20mpg, and 0.47, respectively) I get $235. Per year. Divide by 12 and you get $19.58 per month.

        Compare that to any of your expenses. Hell, compare it to any of your *taxes*. That's peanuts. Shut up. Really, just shut up. You remind me of everyone who complains about the cost of NASA robotic probes. The $0.75 you spent on the mars rovers was worth it just for the damn pictures, and is overwhelmed by the amount you spent on a chocolate bar yesterday.
        • 5 Years Ago
        A lot of good all that extra money is going to do you when the roads and bridges crumble beneath your car. The other option would be to stop the state governments from squandering hundreds of millions of dollars on light rail money pits.
        • 5 Years Ago
        What about state Taxes on gasoline? In California, State and Federal taxes amount to $0.639 per gallon on gasoline and $0.72 per galon on diesel.
        • 5 Years Ago
        @Ernie

        Is it sad that I pay as much in fuel taxes a month that you pay in a year?
        My monthly gas tax comes out to around $145/mo.
        • 5 Years Ago
        Americans on average spend 17% of their disposable income on food. Maybe your priorities need to be adjusted.
      • 5 Years Ago
      How about a variable gas tax to stabilze the pump price@ $3
      • 5 Years Ago
      The US had to the chance to control the world oil price by limiting demand through a shifting of tax from income to oil consumption, instead it has become reliant on imports with no moderating effect of a higher gas tax. The high oil prices caused by a geological ceiling in global oil production burst the sub prime and leveraged investment banking bubbles.

      Every barrel which the US has not imported this year has been consumed by rapidly growing China.

      http://blogs.ft.com/energy-source/2010/01/25/china-setting-the-worlds-oil-prices/

      Production outside of OPEC has peaked, and now Chinese demand and lack of OPEC production growth will continue to add upwards pressure to prices.

      Shift the taxes to fossil fuel consumption and away from income for low and middle earners.
        • 5 Years Ago
        Wrong - even if we had reduced oil consumption we would not have regained control of the price of oil, which is permanently and unfixably in the hands of OPEC. OPEC has the crushing majority of the world's reserves, and it can just cut production as much as necessary to match any drop in consumption until once again the supply available for sale is below market demand - thus the price remains propped up.
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