Driving the Day: Taxing the Miles You Drive

Gas continues to rise, placing a huge burden on Americans; especially those who live in rural areas, live paycheck-to-paycheck, drive to work or drive for a living.  As Victor Davis Hanson reminded us yesterday, many in the environmental movement crave high energy prices.  Before becoming Energy Secretary, Steven Chu frequently asserted, “Somehow we have to figure out how to boost the price of gasoline to the levels in Europe.”  Mr. Chu is undoubtedly pleased at the recent run up in prices.

However, some in the Obama administration are less than pleased; though, for reasons you may not expect.  As gasoline prices continue to rise, Americans drive less.  As a result, the government collects less in tax revenue because fewer gallons of gasoline are purchased.  The 18.4 cent per gallon tax goes to the Highway Trust Fund, which never seems to have enough money to satisfy lawmakers’ desire to bring home transportation pork projects.

According to CQ, the “White House may be warming to an idea it once spurned for funding transportation infrastructure: switching from the current gasoline tax to a levy based on miles driven.”  They say an “unofficial draft” authorization bill would create a new government office to “study and field-test a ‘vehicle miles traveled’ system.”

The idea appears to have some traction with one influential Senator, Budget Committee Chairman Kent Conrad (D-ND), who requested a Congressional Budget Office report on the potential revenue generated.  Conrad also acknowledged the new tax would be in addition to the current gas tax.

It’s a common solution for those on the political left: increase taxes.  Not surprisingly, their scheme will hurt the same people who are already suffering from sky-high gasoline prices.

Read the CBO Report

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