Trump’s Infrastructure Plan Could Involve Federal Gas Tax Hike

U.S. President Donald Trump is expected to unveil an infrastructure plan on Monday, but it is already ripe for opposition in Congress because the plan offers few details on where the federal funds would come from and because it could mean a rise in the federal gas tax that would not sit well with most Republican lawmakers, although some are said to be open to consider such a tax hike.

The infrastructure plan would entail the use of $200 billion in federal funds to spur infrastructure projects worth $1.5 trillion over a ten-year period.

Democrats insist that the funds should include new revenue, and this could mean that the federal gas tax—at 18.4 cents a gallon since 1993—could be raised.

As early as in May 2017, President Trump said that he would be open to considering a gas tax hike if the money is put toward funding highways.

Last month, the U.S. Chamber of Commerce called for a modest increase in the federal fuel fee, because inflation and vehicle fuel economy have eroded its value since it was last raised back in 1993.

“Increasing the fee by a total of $.25 cents, indexed for inflation and improving fuel economy, would raise $394 billion over the next 10 years,” president and CEO Tom Donohue said.

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Republican lawmakers have pushed back on the idea of raising the gas tax, but there are some who are thinking the unthinkable, the Washington Examiner reports.

Republican chairman of the House Transportation and Infrastructure Committee, Rep. Bill Shuster of Pennsylvania, has recently called upon GOP colleagues to consider dropping their opposition to the tax hike.

“I would need a lot of guarantees about how the money is going to be spent before [voting] for a gas tax increase,” Rep. Thomas Massie (R-KY), a member of the Transportation and Infrastructure Committee, told the Washington Examiner. “There is no way I would say I am openly for a gas tax increase. I am not saying never. I am not drawing a red line,” Massie said.

By Tsvetana Paraskova for Oilprice.com

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