Autoblog

New CAFE rules and a stagnant gas tax mean big deficits for infrastructure

Sebastian Blanco — Thu, 03 May 2012 16:28:00 EST

Filed under: Government/Legal, Earnings/Financials

Oh, the gas tax, always a contentious issue. We've covered it throughout the years but now the Congressional Budget Office is reminding us that the time has come to move well beyond simple discussion and politics: the Highway Trust Fund is not getting enough money to pay for the transportation infrastructure that America needs.

As you can see in the chart above, the Fund has not taken in more money than it spent since 2001, except for one time in 2006. In 2008, 2009 and 2010, the Highway Fund got money from the General Fund to pay for things like highway repairs and various mass transit programs.

Since the Highway Trust Fund is mostly paid for by the gas tax, that number plays a big roll in how much money America has to build bridges. Before we move on, though, it's time for a question: What was the last year the U.S. gas tax was raised? The answer and more can be found below.

Continue reading New CAFE rules and a stagnant gas tax mean big deficits for infrastructure

New CAFE rules and a stagnant gas tax mean big deficits for infrastructure originally appeared on Autoblog on Thu, 03 May 2012 16:28:00 EST. Please see our terms for use of feeds.

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New CAFE standards will result in $65B in lost revenue for road projects

Aaron Richardson — Mon, 01 Aug 2011 08:29:00 EST

Filed under: Etc., Government/Legal

According to a new study by the American Road & Transportation Builders Association, new Corporate Average Fuel Economy Standards that mandate cars and light trucks average 54.5 mpg by 2025 will deprive federal highway projects of more than $65 billion in revenues.

That estimation is based on the fact that at-the-pump taxes levied on fuel are by law funneled to transportation projects. With mandatory CAFE fuel mileage increases, the amount of revenue collected from gas taxes will go down, which will cut into road revenues, the report says.

Of course, there are ways of circumventing that lost income, but all that will surely play out in the coming few years. In the meantime, click past the jump to see the report for yourself. Naturally, it's worth noting that the ARTBA, based in Washington, DC, is a group that represents the interests of road and construction workers.

Continue reading New CAFE standards will result in $65B in lost revenue for road projects

New CAFE standards will result in $65B in lost revenue for road projects originally appeared on Autoblog on Mon, 01 Aug 2011 08:29:00 EST. Please see our terms for use of feeds.

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Glenn Beck goes off on GM's Akerson over proposed $1 gas tax, calls Volt "crappy" [w/video]

Sebastian Blanco — Fri, 10 Jun 2011 17:31:00 EST

Filed under: GM, Electric

Glenn Beck on the gas tax - Click above to watch video after the jump

If there's one thing that is fast becoming true about the Chevy Volt, it's that right-wing political pundits really, really don't like it. So, we will admit up front that this story comes straight out of the "predictable/it's not news when an idiot says something stupid" file, but it's still worth something.

What's the deal? Well, apparently, Fox News' Glenn Beck and Republican presidential candidate Herman Cain think it's beyond the pale for General Motors' CEO, Dan Akerson, to have called for an increase in the gas tax. Beck got his dander up, saying to Akerson (through the camera):

I've seen your crappy new electric car, and no one's buying it... A 50-cent gas tax would make everyone puke. A dollar might make me puke my heart and lungs. There is a bi-partisan pukage going on here with GM, and that's what happens when gas goes up.

There's nothing in the way of context or reasons why a gas tax might be a good thing, but Beck does draw ties between Akerson and George Soros (one of Beck's favorite targets) and others through the Carlyle Group. See for yourself after the jump. The gas tax discussion starts at minute 26:30.

Continue reading Glenn Beck goes off on GM's Akerson over proposed $1 gas tax, calls Volt "crappy" [w/video]

Glenn Beck goes off on GM's Akerson over proposed $1 gas tax, calls Volt "crappy" [w/video] originally appeared on Autoblog on Fri, 10 Jun 2011 17:31:00 EST. Please see our terms for use of feeds.

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How the gas tax is under threat from green vehicles

Paul Eisenstein — Mon, 06 Dec 2010 16:35:00 EST

Filed under: Government/Legal, Earnings/Financials

Can Governments Afford To Incentivise Electric Cars?

Live in the right part of California and work for the right company and you might be able to buy the new Nissan Leaf for as little as $12,500, as Autoblog has reported, due to the raft of incentives that are available for buyers of the little battery car and other high-mileage, low-emission products.

In recent years, lawmakers have been racing to come up with incentives designed to encourage motorists to migrate to clean, efficient vehicles. It's a clearly noble effort, but one that deserves a closer look in an era of fiscal restraint.

Several states are looking at a more direct form of taxation: a per-mile usage fee on battery-based vehicles.

The feds, and most states offering such incentives, have put caps on their zero-emission incentive programs, and most will vanish by mid-decade. But, ironically, if these programs do what they're intended to, the fiscal impact could be felt for years to come. It turns out that going green could plunge state and federal balance sheets into the red.

The short-term costs are already potentially significant. At the federal level, a $7,500 tax credit could drain billions of dollars a year out of the Treasury if major automakers come even close to their battery car sales targets by mid-decade.

Such cash incentives - along with other perks, such as access to California's HOV lanes - are designed to motivate the move to vehicles like the Leaf and the new Chevrolet Volt. Once momentum starts building, these givebacks can be phased out, proponents contend. But they're missing a big part of the picture.

Continue reading...

Paul A. Eisenstein is Publisher of TheDetroitBureau.com, and a 30-year veteran of the automotive beat. His editorials bring his unique perspective and deep understanding of the auto world to Autoblog readers on a regular basis.

Continue reading How the gas tax is under threat from green vehicles

How the gas tax is under threat from green vehicles originally appeared on Autoblog on Mon, 06 Dec 2010 16:35:00 EST. Please see our terms for use of feeds.

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Democrats and Republicans agree on higher gas taxes, just not in public all the time

David Kiley — Fri, 03 Dec 2010 16:30:00 EST

Filed under: Government/Legal

Senator Alan Simpson (left) and Erskine Bowles (right), Co-Chairman of the Deficit Reduction Commission

There is a sport in Washington D.C. that comes around like deer season every year: the gas tax debate. And stepping into the clearing this week with brown overcoats and deer antler hats are some former legislators and government officials - none of whom have to run for office - who are recommending a 15-cent additional federal gas tax starting in 2013 to help trim the federal budget deficit.

This measure has about as much chance of getting through the new Congress as a proclamation that would make Earth Day a national bank holiday. Still, given the fact that the Feds have laid a claim to my nine-year old son's unborn children's piggybanks, it's worth a few minutes to air out the subject.

The co-chairman of the bipartisan deficit reduction commission, former Clinton Administration official Erskine Bowles and former Republican Senator Alan Simpson, have called for a sweeping set of reforms in the way of taxes, spending cuts and elimination of a myriad of tax credits and deductions to which we have grown accustomed - mortgage interest for one.
The 15-cent per gallon hike in Federal gas taxes is paltry by European standards, but would be used specifically for transportation infrastructure improvement: roads, bridges, etc.

Continue reading...

Continue reading Democrats and Republicans agree on higher gas taxes, just not in public all the time

Democrats and Republicans agree on higher gas taxes, just not in public all the time originally appeared on Autoblog on Fri, 03 Dec 2010 16:30:00 EST. Please see our terms for use of feeds.

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Report: NADA chairman urges Fed to reconsider fuel rules

Zach Bowman — Fri, 22 Oct 2010 18:30:00 EST

Filed under: Car Buying, Government/Legal

The National Automobile Dealers Association has joined the ranks of those opposed to upping Corporate Average Fuel Economy standards to 60 mpg by 2025. The dealer group says that with fuel prices still low, consumers are more interested in horsepower and style than they are super-efficient vehicles. That means that if the federal government starts mandating ever more efficient vehicles that are significantly costlier to manufacture, dealers are likely to see sales falter as automakers have to elevate MSRPs to keep from losing their shirts. That's the fear of NADA chairman Ed Tonkin and his constituents. Tonkin should know - he himself owns a mutli-brand dealership in Portland.

Of course, Tonkin's argument hinges against further upping CAFE numbers hinges upon fuel prices staying at their current levels -- something that even the most optimistic minds are hesitant to believe. The federal government is expected to unveil its plan for increasing fuel economy standards early next year. So far, word has it that the Obama Administration is looking to impose an average of 35 mpg by 2016 and as much as 60 mpg by 2025.

[Source: The Detroit News | Image: NADA]

Report: NADA chairman urges Fed to reconsider fuel rules originally appeared on Autoblog on Fri, 22 Oct 2010 18:30:00 EST. Please see our terms for use of feeds.

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Consumer Federation of America calls for 60 mpg CAFE standard by 2025

Autoblog Staff — Fri, 03 Sep 2010 15:56:00 EST

Filed under: Etc., Government/Legal, Technology

Now that the National Highway Traffic Safety Administration and Environmental Protection Agency have established fleet fuel economy standards of 35.5 miles per gallon by 2016, the government agencies are hard at work on the next phase of increases that will stretch out to 2020 and beyond. The 2007 Energy Independence and Security Act mandated 40 mpg by 2020 as a minimum, but the standards could actually be set higher. That's exactly what the Consumer Federation of America (CFA) and Natural Resources Defense Council (NRDC) want.

A report from CFA declares that the technology exists to raise fuel economy standards to 60 mpg by 2025 and estimates that doing so would add about $2,600 to the cost of new cars and $3,200 to light trucks. CFA's analysis indicates that, at the equivalent of $3.50 per gallon in 2025, the payback period for the extra costs would only be five years. While the technology definitely exists to produce 60-mpg vehicles, the real problem is consumer behavior, and most American consumers probably won't buy the kinds of small cars required to meet those standards at current fuel prices - particularly with that much cost tacked on to their MSRPs.

Hitting 60 mpg while maintaining the size and capability Americans currently buy would doubtlessly cost substantially more. In order to get people to buy such vehicles, critics suggest there will need to be significantly higher prices at the pump. The idea of a revenue-neutral petroleum tax (whereby other taxes would be cut to compensate) that establishes a floor price of at least $4 per gallon could be a good place to start on the way to 40 mpg. Getting people into 60-mpg vehicles would probably require an even higher floor - perhaps $5/gal or more.

[Sources: Green Car Advisor, Consumer Federation of America]

Continue reading Consumer Federation of America calls for 60 mpg CAFE standard by 2025

Consumer Federation of America calls for 60 mpg CAFE standard by 2025 originally appeared on Autoblog on Fri, 03 Sep 2010 15:56:00 EST. Please see our terms for use of feeds.

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Study: Americans prefer tolls over fuel taxes... how about you?

Sam Abuelsamid — Mon, 26 Jul 2010 15:29:00 EST

Filed under: Government/Legal, Earnings/Financials

One fact seems indisputable: Americans have come to hate taxes and any suggestion by a politician to raise them is tantamount to political suicide. The problem is that public infrastructure requires funding - and lots of it. Critics of this disparity would argue that a lack of political will to raise fuel taxes has left roads, bridges and tunnels across America crumbling in recent decades.

A new survey conducted by HNTB Corporation suggests that Americans would prefer to pay tolls or let their roads crumble rather than pay higher fuel taxes. While this may well be a valid survey, it's important to note that HNTB is an infrastructure firm that supplies toll collecting equipment, among other things.

In any case, the study's findings note that "when given a choice between new roads funded by an increased gas tax, by new tolls or no new roads at all, Americans prefer tolls (41 percent) or no new roads at all (41 percent) over increased gas taxes (18 percent)." Further, "A strong majority of Americans (84 percent) feel tolls should be considered project-by-project or as a primary source of transportation revenue. Only a small minority (16 percent) say tolls should never be used."

In the old days, toll booths were a pain because every car had to stop and pay. The advent of affordable radio frequency transponder systems like EZ-Pass now allows commuters to drive toll roads and pay automatically without stopping - or even thinking about how much money using such systems costs them. Of course, this type of toll collecting raises other issues including invasion of privacy concerns, since the operators know where specific cars are at certain points in time. There's also the possibility of account hacking or errors where someone could end up charging their driving to other accounts.

What do you think about tolls? Check out the full press release after the jump for more of the study's findings, then drop your fellow readers a line in Comments.

[Source: HNTB Corporation | Image: Wikimedia Commons]

Continue reading Study: Americans prefer tolls over fuel taxes... how about you?

Study: Americans prefer tolls over fuel taxes... how about you? originally appeared on Autoblog on Mon, 26 Jul 2010 15:29:00 EST. Please see our terms for use of feeds.

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Autoblog Podcast #181 - Mercury, Ed Whitacre, Gas Tax and Guessing Cops

Dan Roth — Tue, 08 Jun 2010 17:15:00 EST

Filed under: Podcasts, Etc., Government/Legal, Technology, Earnings/Financials

Click above for the Autoblog Podcast in iTunes, RSS or listen now!

Thanks for your your questions for Episode #181 of the Autoblog Podcast. This week,Chris, Sam, Dan and Alex take them on. News topics we cover are a little more on the shuttering of Mercury, Ed Whitacre's management bushwacking at GM, a lively gas tax discussion, Ohio cops with radar guns for optic nerves, and the dieselphiles among us just had to kibbitz about the new Range Rover diesel that was apparently originally destined for the Ford F150. We wrap it up by tearing up a particular message from one of you dear listeners, so be sure to hang out till the end.

Autoblog Podcast #181 - Mercury, Ed Whitacre, Gas Tax and Guessing Cops

In the Autoblog Garage:

Cadillac CTS Sport Wagon
Kia Sorento V6
Ford Transit Connect
Lexus ES350

News:

Hosts:
Chris Shunk, Dan Roth, Sam Abuelsamid, Alex Nunez

Runtime: 1:22:10

Get the podcast:
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[MP3] Download the MP3 directly

Feedback:
Email: Podcast at Autoblog dot com
Voicemail: 734-288-8POD (734-288-8763)

Review the show in iTunes and take our survey

Autoblog Podcast #181 - Mercury, Ed Whitacre, Gas Tax and Guessing Cops originally appeared on Autoblog on Tue, 08 Jun 2010 17:15:00 EST. Please see our terms for use of feeds.

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Taxes drive gas prices to over $7 a gallon in UK, mass boycott coming soon

Eric Loveday — Wed, 21 Apr 2010 07:59:00 EST

Filed under: Etc., Government/Legal, UK

Through the power of Facebook, up to a half a million drivers in the UK are expected to boycott gas next month shortly before the nation heads to the polls for a general election in which Prime Minister (PM) Gordon Brown is fighting stiff competition for the win.

Many Brits are upset with recent gas tax increases that were supported and passed by PM Brown. Protesters hope that the mass demonstration will be the nail in the coffin for his chances of winning. Gas prices have soared in Britain, reaching U.S. $1.87 a liter (about $7.06 a gallon) last week. The numbers are a significant increase from a year ago when gas was only $5.55 a gallon. Further upsetting residents, the government pockets a whopping $4.42 from each gallon sold, yet still insists that more taxes are needed. Another government-mandated tax increase is scheduled for this fall followed by one more next winter and, frankly, many people are fed up.

On May 1st, protesters will go into action by blocking entry into local gas stations. As boycott organizer Jo Slater said, "We need to take action, the only way we'll see petrol prices fall is if we hit someone in the pocket." Additional protests are scheduled across the nation with support from the trucking industry and farmers.

Here in the states, we constantly hear complaints of gas prices that are astronomical. Sure, $2.80 might seem like a lot to us, but it's like a slap in the face compared to the UK's knock-out blow. Ouch. Our thanks go to Andy for this one!

[Source: NewsoftheWorld | Image: BradleyPJohnson - C.C. 2.0]

Taxes drive gas prices to over $7 a gallon in UK, mass boycott coming soon originally appeared on Autoblog on Wed, 21 Apr 2010 07:59:00 EST. Please see our terms for use of feeds.

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WSJ Column: Higher gas taxes better strategy than CAFE to save GM

Sebastian Blanco — Mon, 06 Jul 2009 18:30:00 EST

Filed under: Electric

2009 Chevrolet Cruze - Click above for high-res image gallery

Ford Executive Chairman Bill Ford and AutoNation CEO Mike Jackson were just two voices that spoke out in favor of a higher gas tax earlier this year. While we took the Cato Institute's Alan Reynolds to task for muddying the waters of the "Toyota-licensed hybrid Fusion", there's reason to look deeper at his argument (published in The Wall Street Journal) which maintains that a higher gas tax isn't just a good way to encourage sensible car purchases, it also stands to be helpful in saving troubled domestic automakers like General Motors. Reynolds writes:

The federal fuel tax is highest on the most efficient fuel (diesel) and below zero on the least efficient fuel (ethanol). Cars get about 30% better mileage on diesel than on gasoline, and cars running mainly on gasoline get about 30% better mileage than they would using 85% ethanol.

To stop distorting consumer choices, simply apply the same 24-cent-a-gallon federal tax to gasoline and ethanol as we do to diesel. This would add funds to the depleted federal highway trust. More importantly, it would remove an irrational tax penalty on buying diesel-powered cars -- arguably the most cost-effective way to improve mileage without reducing car size or performance.

Since GM, already on the government dole, sells (proportionally) so many large vehicles, it will need to sell more smaller or diesel-powered vehicles to offset its truck fleet and to meet upcoming CAFE standards. Reynolds doesn't think CAFE is a good idea, and claims there's a better way to make sure GM survives. Reynolds says that a higher gas tax would allow the Detroit automaker to keep building the cars it builds best ("midsize and large sedans, sports cars, pickup trucks and SUVs"). Only by upping the gas tax and totally scrapping CAFE, Reynolds says, will GM not be forced to take even more money to survive - and to pay the CAFE fines it's sure to acquire. Doing so would also allow The General to not waste "more taxpayer money on 'retooling' to produce unwanted and unprofitable subcompacts and electric cars."

Gallery: Paris 2008: Chevrolet Cruze

[Source: Wall Street Journal]

WSJ Column: Higher gas taxes better strategy than CAFE to save GM originally appeared on Autoblog on Mon, 06 Jul 2009 18:30:00 EST. Please see our terms for use of feeds.

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EDITORIAL: Attention Wall Street Journal - Ford does not use Toyota's hybrid system!

Sam Abuelsamid — Sun, 05 Jul 2009 15:10:00 EST

Filed under: Green

2010 Mercury Milan Hybrid - Click above for high-res image gallery

In a recent op-ed piece published in The Wall Street Journal, Alan Reynolds of the Cato Institute starts by making a few decent points about fuel taxation and fuel economy rules. Unfortunately, he undermines himself with some blatant errors and misinformation. In discussing how Detroit automakers will deal with new fuel efficiency requirements, he makes the all-too-common mistake of referring to Ford's hybrid system as licensed from Toyota ("Similarly, Ford has the Toyota-licensed hybrid Fusion and will soon produce the European Ford Fiesta in Mexico").

The reality is that Ford independently developed its own hybrid system at the same time Toyota was masterminding its own. The basic architecture of both systems is the same and both are based on the concepts developed and patented by TRW engineers in the late 1960s. When Ford introduced the Escape Hybrid, Toyota went after the Blue Oval for infringing on its patents. Ford had patents of its own on the technology that Toyota was using. Eventually, the two companies reached a cross-licensing agreement that gives both companies the right to build their own systems. Such cross-licensing agreements are common in these kinds of cases, but Ford did not use the Toyota hybrid system. The only other company that uses Toyota's system is Nissan for its Altima hybrid, and they actually buy hardware from Toyota. We continue deconstructing Reynolds' arguments after the jump

Gallery: Review: 2010 Mercury Milan Hybrid

[Source: Wall Street Journal]
Photos Copyright (C)2009 Sam Abuelsamid / Weblogs, Inc.

Continue reading EDITORIAL: Attention Wall Street Journal - Ford does not use Toyota's hybrid system!

EDITORIAL: Attention Wall Street Journal - Ford does not use Toyota's hybrid system! originally appeared on Autoblog on Sun, 05 Jul 2009 15:10:00 EST. Please see our terms for use of feeds.

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Wagoner: Gas tax hike is "worthy of consideration"

Jeremy Korzeniewski — Wed, 18 Mar 2009 15:29:00 EST

Filed under: Hybrid, Government/Legal, Green, GM

Count General Motors' CEO Rick Wagoner as one proponent for a raise in the federal gas tax. While the idea seems like political suicide for any legislator willing to jump on board, hiking the gas tax up so that a gallon of gas hovers around the $4.00 mark could have a few desirable effects, notably influencing consumers to purchase fuel efficient vehicles and funding road improvement projects that are currently out of cash.

Last summer, when fuel prices were at their record peaks, interest in hybrid vehicles and smaller cars was also at an all-time high. With the introduction of the Chevy Volt tentatively scheduled for late 2010, perhaps it's not so surprising to hear that GM, once a major detractor of artificially high fuel prices, is now singing a new tune.

Still, it seems unlikely that the government would raise the gas tax in the midst of a recession. After all, it's much easier for legislators to direct a mandate at automakers to produce more fuel efficient vehicles without worrying about whether consumers will be motivated to buy them.

[Source: Washington Times, Photo by Bill Pugliano/Getty]

Wagoner: Gas tax hike is "worthy of consideration" originally appeared on Autoblog on Wed, 18 Mar 2009 15:29:00 EST. Please see our terms for use of feeds.

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Mass. governor pondering so-called "Hummer Tax"

Michael Harley — Mon, 09 Mar 2009 12:28:00 EST

Filed under: Car Buying, SUV, Truck, Government/Legal, Green, Hummer

Click above for a high-res gallery of the 2009 Hummer H2

The Governor of Massachusetts is backing a new state proposal to tax larger gas-guzzling vehicles each year when drivers register them. The so-called "Hummer Tax" would be the first in the nation, and it is designed to directly discourage ownership of SUVs and pickups. To further chill ownership of larger and more inefficient vehicles and steer buyers towards the small cars, the plan includes provisions to discount fees for owners with lighter and more miserly cars.

"It's a penalty for driving an SUV, which currently is not the popular choice. Or you're being penalized for a lifestyle choice, or maybe the fact that you have a large family and you need that size vehicle to put them in and it just doesn't seem fair," said Tim Lerchenfeldt, general manager of Cadillac Hummer Saab Village in Norwwood. He argues that now is not the time for additional fees, especially when the industry is struggling and sales across the board are down.

The transportation system in Massachusetts is suffering from more than a decade of neglect, according to Democratic Governor Deval Patrick, and the tax would be just one of the ways to raise the funds to foot the repair bill (the plan also includes a controversial 19 cent increase in the state's gas tax). While the "Hummer Tax" benefits from a lightning rod of a nickname, the premise of hitting select consumers who already pay more at the pump with yet another fee doesn't exactly sound universally welcomed.

Gallery: 2008 HUMMER H2

[Source: Foxnews]

Mass. governor pondering so-called "Hummer Tax" originally appeared on Autoblog on Mon, 09 Mar 2009 12:28:00 EST. Please see our terms for use of feeds.

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Oregon considers taxing mileage, not gas

Jonathon Ramsey — Sun, 04 Jan 2009 10:54:00 EST

Filed under: Government/Legal, Green

Oregon ran a pilot program in 2006 and 2007 that fitted 300 cars with GPS receivers, which kept track of the cars' mileage. The receivers also kept records of when the cars were on the road, noting whether they traveled during rush hour or not. When the drivers went to several specially-equipped gas stations, they paid a mileage tax based on how far they had driven and when they drove, rush hour being more expensive than the wee hours.

Taxing mileage -- as opposed to trying to raise fuel taxes -- is an idea that's not only raising eyebrows, it's also raising interest. Seven other states are reported to be interested in finding a publicly-palatable way to tax mileage. A panel in North Carolina even recommended that drivers be charged a quarter-cent-per-mile for their year's driving. In such a scenario, after 15,000 miles you'd owe the state $37.50.

Naturally, the hurdles are many and it will be years before we see anything like this happening -- but beware: it's gone beyond "Let's think about it" to "Let's look into this." States envision working with manufacturers to get the standardized mileage-reporting technology installed in cars. In addition to the substantial privacy issues that would raised by such a move, there's a question of whether a flat mileage tax would blunt the move to energy-efficient vehicles -- the gent in the Prius might not be happy about paying the same as the gent in the F-250 Super Duty.

[Source: Yahoo!]

Oregon considers taxing mileage, not gas originally appeared on Autoblog on Sun, 04 Jan 2009 10:54:00 EST. Please see our terms for use of feeds.

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Road commission calls for gas tax hike

Jonathon Ramsey — Sat, 03 Jan 2009 15:43:00 EST

Filed under: Etc., Government/Legal, Green, Earnings/Financials, Lifestyle

A gas tax is about more than putting liquid into your tank and subtracting a higher amount from your bank account. A gas tax is -- just like CAFE and hybrids and $25 billion set aside to finance fuel efficient technologies -- about reworking and redefining our entire system of private transportation. And since that system is most certainly going to redefined, it is no surprise that the National Commission on Surface Transportation Infrastructure Financing has recommended a jump in the federal fuel tax.

Congress created the commission to examine the federal taxes on fuel -- currently 18.4 cents for gas and 24 cents for diesel -- and the commission came back with the same results as everyone else: people are driving less, and driving more fuel efficient cars, and that has killed revenue for transportation infrastructure. One member of the commission said, "I'm not excited about a gas tax increase, but the reality is our current gas tax doesn't pay for upkeep of the system we have now. We can either let the roads go to hell or we can pay more." If the roads go to hell, though, guess what? We're going to pay more, but that money will go to service departments and auto parts stores.

The proposed solution is to make the gasoline fuel tax 24.4 cents, and the diesel tax between 36 and 39 cents. That would begin to make up for the $105 billion difference between actual revenues and the money needed to upkeep our roads and highways. It is conceivable that a higher gas tax could also encourage people to buy those high-mileage vehicles the government keeps commanding Detroit to make. But before that happens, it will probably just make a lot of people anguished and angry.

[Source: CNBC]

Road commission calls for gas tax hike originally appeared on Autoblog on Sat, 03 Jan 2009 15:43:00 EST. Please see our terms for use of feeds.

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It's not just California: Michigan wants to raise the gas tax, too

Jonathon Ramsey — Sun, 28 Dec 2008 18:02:00 EST

Filed under: Etc., Government/Legal

California isn't the only one taking aim at the pumps in an effort to raise state revenue. The Michigan state legislature is also proposing a hike in its gas tax that could potentially make its gas taxes the highest in the nation. The current nineteen cent per gallon tax on gas, and fifteen cent per gallon tax on diesel, would be replaced by a simple 18% tax on the wholesale prices of both. Michigan says that the state isn't earning enough now that people are driving less, and driving more fuel efficient cars.

The reasons in for the tax are the same in MI as they are in CA: the transportation sector and road funding are sorely inadequate. Michigan has legendarily bad roads -- not the worst in the nation, but close in some cases. The oil and gas station lobby, however, wants none of it. One oil company exec said, "Cheap fuel prices are fueling the (economic) activity we have now. Taxing gasoline to fix roads is an old way of doing it." They are also worried that when gas prices inevitably go back up, the tax will make pump prices exorbitant.

A Michigan transportation rep said "We didn't necessarily see memos coming out from them when the price of fuel exceeded $4 a gallon." He also said that the tax is capped in the first couple of years, so no one needs to be concerned. The measure, along with a rise in DMV registration fees, is expected to raise $1.5 billion per year. If it doesn't pass this year, the legislature is expected to resurrect it next year. Hat tip to Braggin Dragon!

[Source: Michigan Live]

It's not just California: Michigan wants to raise the gas tax, too originally appeared on Autoblog on Sun, 28 Dec 2008 18:02:00 EST. Please see our terms for use of feeds.

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The NYT chimes in: time for a gas tax

Jonathon Ramsey — Sun, 28 Dec 2008 13:04:00 EST

Filed under: Government/Legal, Lifestyle

Can you hear that? Those are the war drums, and more and more of them are beating the same tune: bring on the gas tax. An editorial in The Gray Lady is the latest and arguably the weightiest to join the shock troops advocating for higher gas prices. The writer proposes a fluctuating consumption tax that would keep gas at least $4 per gallon in 2008 dollars, while an economist suggests a sliding tax on the price of a barrel of oil to achieve the same effect.

The NYT admits "a bitter recession is not the most opportune time to ratchet up the price of energy." But it balances that against the coming Obama administration's aims, the government's enviro-friendly suggestions to the U.S. auto industry, and Americans' claims to want to get off of foreign oil.

Although not mentioned specifically in the Times piece, some recommend a gas tax for a reason that has nothing to do with environmental stewardship: state governments need money. States are making enormous budget cuts, trying to sell and lease their lotteries, state parks, roads, bridges, and even their airports, and lining up for federal aid totaling hundreds of billions of dollars, and still saying they won't have enough money. The answer to "Will there be a gas tax?" could be, as Jesse Jackson once said, "The question is moot!" The question is not whether there will be a gas tax, but whether you will pay your additional taxes at the pump, at the toll booth, in your paycheck, etc...

[Source: New York Times]

The NYT chimes in: time for a gas tax originally appeared on Autoblog on Sun, 28 Dec 2008 13:04:00 EST. Please see our terms for use of feeds.

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Ward's columnist wonders if Americans can handle the truth about gas taxes

Sam Abuelsamid — Sat, 27 Dec 2008 18:57:00 EST

Filed under: Car Buying, Trends, Government/Legal, Green

People have always had something of an aversion to hard truths. Most Americans say they want their country to get off foreign oil or help the environment, but when it comes to the bottom line, they want cheap fuel. And when the prices on gas pumps start to dip, consumer interest in smaller more efficient vehicles tends to go out the window. Understandably, drivers everywhere tend to make vehicle purchasing decisions in large part based on fuel prices.

Ward's Auto World columnist Drew Winters notes that executives like Bob Lutz have long advocated that fossil fuel prices need to increase in order to make more efficient vehicles appeal to consumers. But with U.S. consumers' almost instinctual avoidance of taxation, it has been difficult for politicians to consider such measures. Instead, it would appear that most constituents want government to mandate both more fuel efficient cars (through mechanisms like CAFE) and cheap gas without impacting the cost of automobiles themselves.

Winters paraphrases The End of Oil author Paul Roberts, noting that "every major fuel shift in history - from wood to coal to oil - was driven primarily by market forces, specifically by competitive advantages of the new fuel over the old." Thus, part of the solution may simply to make the fossil fuels more expensive relative to other energy sources.

Unfortunately, Winters surmises, it appears that nobody can handle this truth.

[Source: Ward's Auto World | Photo: GoodGreentips.com]

Ward's columnist wonders if Americans can handle the truth about gas taxes originally appeared on Autoblog on Sat, 27 Dec 2008 18:57:00 EST. Please see our terms for use of feeds.

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California legislature passes budget with a $0.39 per gallon gas "user fee"

Jonathon Ramsey — Thu, 25 Dec 2008 21:01:00 EST

Filed under: Etc., Government/Legal

California hasn't been able to borrow money for months, and according to the state's treasurer, it will run out of money in February or March if it doesn't pass a budget and get some income flowing. The majority Democratic legislature has sent Governor Schwarzenegger a budget that contains a suite of "revenue enhancements" that the Democrats call fees, not taxes. In addition to a jump in the state sales tax and personal income tax, there's also a provision to apply a per gallon gas "fee" of 39 cents.

The biggest problem with the proposed budget is the way in which it was passed, which relies on the definition of the word "tax". Democrats used a simple majority vote to pass the proposed budget, instead of the mandatory 2/3 majority needed to pass new taxes, because they say "it does not technically increase the amount of taxes on Californians." For instance, because the gas "fee" would be set aside for transportation projects only, it isn't a tax, it's a user fee, and so it doesn't require a 2/3 majority vote.

Call it what you want, Californians would be paying more money, so Republicans have vowed not to support what they call increased taxes. Citizen's groups have also promised to sue the state if Schwarzenegger signs the proposed budget as is. The other problem is that Schwarzenegger has already vowed to veto it, but not over the tax vs. fee issue. He said he'll let other people sort that out - what he really wants are bigger cuts in spending before he'll approve anything. The budget discussions resume on Friday as lawmakers work to have something done by year's end. Thanks for the tip, Fed!

[Source: Yahoo!]

California legislature passes budget with a $0.39 per gallon gas "user fee" originally appeared on Autoblog on Thu, 25 Dec 2008 21:01:00 EST. Please see our terms for use of feeds.

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