A Lot Has Changed Since 1993…Except the Federal Gas Tax

According to MinnesotaGasPrices.com, the average statewide price this week is $3.85 per gallon and rising.

Ouch.

But how much of the price at the pump is due to federal taxes?  It may be less than you think.

The United States federal excise tax on gasoline is 18.4 cents per gallon (24.4 cents for diesel fuel)—and has remained the same since 1993.  Since it’s a flat rate (not a percentage of the price, like a sales tax), tax revenues do not rise even if gas prices do.

This means the buying power of these revenues is significantly less that it was18 years ago.  That’s like you never seeing an increase in your paycheck to match inflation…since 1993.

Estimates by the Wisconsin Transportation Development Association suggest that the federal government would need to increase the tax to at least 28 cents per gallon just to recapture the purchasing power lost to inflation since 1993.

In this era of “no new taxes” and calls for streamlining government, I know that the topic of the gas tax is a controversial one.  But as a deadline looms for the reauthorization of the federal surface transportation program, it’s no wonder that funding is such a stumbling block.

Is raising the gas tax worth it to you?

Are safe, driveable roads worth $9 a month to you?

A large majority of Americans think spending on transportation infrastructure is important, according to a recent national poll.

It’s interesting to note, however, that the majority also opposes paying more of their own money to improve or modernize our transportation systems.

  • 80 percent believe that improving and modernizing transportation systems will boost local economies and create jobs.
  • Seventy-one percent oppose an increase in the gas tax.
  • Sixty-four percent oppose new tolls on existing roads and bridges.
  • Fifty-eight percent oppose paying a fee based on the number of miles they drive.

I can certainly sympathize with these respondents, who are feeling the pinch of a tight economy and reacting accordingly.  I know gas prices at $4.00 inspire a lot of anxiety in plenty of people, myself included.

However, my recent trip to the Transportation Development Association conference in Madison highlighted the issue of the federal gas tax that helps to build, repair and maintain a first-rate nationwide transportation infrastructure.

The gas tax is currently a flat rate of 18.4 cents per gallon – the same as it’s been since 1993. Unfortunately, prices of asphalt and other road-building materials haven’t held so steady, so the budget for keeping roads safe and efficient is approaching a breaking point.

TDA has pointed out that an increase in the federal gas tax by 10 cents per gallon would cost the average family $9 more a month.  Are faster, safer commutes and trips worth that much to you?

Or perhaps the better question is, for critical transportation infrastructure–where would you prefer the money come from?

Guiding the Future of Transportation and Planning – With Your Input


We need your input to help us accomplish our mission: ”Guiding the Future of Transportation for the Twin Ports Area.” Our job is to think ahead and plan for ways that federally-funded infrastructure investments can improve the ways we travel around this area — not just on roads, but also on foot, by bike, and on the bus.

Part of what we do is to seek out and incorporate ideas and information from area residents, elected officials, planners and engineers from all local jurisdictions (city, county, state and township). With your input we can encourage good local policy decisions and put forward projects for federal transportation funding that will enhance livability and optimize the movement of people and goods within the Duluth and Superior metropolitan area.

That’s where this blog comes in. We’re looking forward to speaking with you about everything transportation-related going on in the Twin Ports. If you want to be alerted when we start posting content later this month, just drop your e-mail into the slot on the right that says “Want This Blog Via Email?”

And we’re already talking with you on Facebook.  To join us there, just click on the link here.http://www.facebook.com/dsmic

Bye for now.  Hope you’ll stay tuned and become part of the conversation.