Bipartisan Plan to Increase Fuel Taxes Surfaces

A surprising and unexpected bipartisan plan to increase gas and diesel taxes by 12 cents each emerged June 18 from Sens. Bob Corker (R-Tenn.) and Chris Murphy (D-Conn.). Taxes would increase six cents a gallon annually for two years.

2 minute read

June 19, 2014, 10:00 AM PDT

By Irvin Dawid


"The Murphy-Corker plan would raise the gas tax by 12 cents over the next two years, raising $164 billion over the next decade and covering the shortfalls in the Highway Trust Fund," writes Alexander Bolton about the plan that would also index the taxes to the consumer price index to keep pace with inflation.

In the words of Streetsblog's Tanya Snyder, this one "might actually have a chance."

The tax increase is offset with $189 billion in tax relief proposals over the next decade, though that did not dissuade the American for Tax Reform and other conservative organizations from not opposing their plan, which may prove to be a considerable challenge for senators who took a pledge to oppose any tax increase legislation.

However, senators who want to ensure that the states they represent have healthy transportation budgets might be influenced by Corker's press release: "Tennessee Could See 50 Percent Reduction in State’s Transportation Budget in 2015 if No Solution is Reached". 

While a major tolling advocate was disappointed that the Corker-Murphy proposal didn't allow for interstate tolling as does Obama's Grow America Act, they praised the plan nonetheless, calling it “gutsy” but warning that "increasing the gas tax and indexing it to inflation would still not permanently solve the problems with transportation funding in the U.S.," writes The Hill's Keith Laing.

How does the Corker-Murphy plan compare with other revenue-producing proposals? Snyder writes that it "has far more potential than anything else that’s been offered."

President Obama’s corporate tax scheme was dead on arrival, even though it had support from the Republican chair of the Ways and Means Committee, Dave Camp. Rep. Peter DeFazio’s idea of a per-barrel oil fee and Sen. Barbara Boxer’s idea for a wholesale oil tax don’t have Republican support. Neither does Rep. Earl Blumenauer’s 15-cent gas tax hike, which was the most logical proposal on the table, until now. 

Bolton captured Corker's summation of the House Republican proposal based on funneling savings from the Postal Service: “Only in Washington would you take money from insolvent enterprise to fund another insolvent enterprise.”

Wednesday, June 18, 2014 in The Hill

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