A new report is out from Institute on Taxation and Economic Policy Building a Better Gas Tax: How to Fix One of State Government’s Least Sustainable Revenue Sources.
I like the report and generally agree that increasing the gas tax, and building a better one, is appropriate as a short-term fix (until vehicle electrification and better fuel economy overtake it), so long as the funds are not spent on system expansion until the existing system is properly maintained (or abandoned where appropriate). I have some quibbles:
“As Figure 4 indicates, even a twenty cent per gallon tax increase would cost the average driver under $9.00 per month, and at least some of that cost would undoubtedly be offset through lower vehicle repair costs and less wasted gasoline burnt while stuck in traffic.” – If raising the gas tax is a socially good thing, all of it should be offset by private gains on average. The average driver should save time and money (or achieve value and avoid losses) which exceeds the additional tax (over the long term). If they don’t, why should they support such a thing?