Tag Archives: highway-trust

Highways Are Now Being Held Hostage to Lower Corporate Taxes

by MiltonLloyd Posted on July 14, 2015

Mother Jones

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I somehow missed that this was a real thing, but apparently there are finally serious moves afoot to replenish the Highway Trust Fund. Will this happen by sensibly returning the gasoline tax to its old rate? Don’t be silly. Instead we’re going to do it in least sensible way possible:

A bipartisan proposal, to be introduced soon in Congress, would tax the estimated $2 trillion in foreign profits held by U.S. corporations in overseas accounts….The tax would generate tens of billions of dollars for the federal Highway Trust Fund, which will run out of money at the end of the month. Lawmakers have been in a desperate scramble to replenish the fund, which helps pay for new roads, bridges and other transportation infrastructure.

….Supporters said the plan would reduce incentives for companies to reincorporate overseas, a controversial tax-reducing tactic known as inversion that has drawn the ire of Democrats….”These proposals would right the ship, provide a potential funding source for transportation reauthorization and allow the United States to compete on a level playing field,” Sen. Chuck Schumer said.

Hold on. We’re going to take all those overseas profits that are currently untaxed, and levy a one-time tax on them in order to fund roads and bridges? Why would Republicans and the business community support this? Here’s why:

“In a perfect world, you wouldn’t tie tax reform to the Highway Trust Fund,” said Curtis S. Dubay, a tax expert at the conservative Heritage Foundation. But lawmakers see the need to find highway funding “as a forcing mechanism to get something done” on international taxes.

A “forcing mechanism”? Please go on:

The U.S. Chamber of Commerce and National Assn. of Manufacturers have said they opposed a forced repatriation of foreign earnings simply to replenish the Highway Trust Fund.

But including it as part of a shift from the current international tax system — a move that would reduce corporate tax bills over the long term — changes the equation, said Dorothy Coleman, who handles tax policy for the manufacturers group.

….Business groups want changes to the international tax system to be made as part of a broader overhaul that includes lowering the corporate tax rate for domestic earnings as well. Senate Majority Leader Mitch McConnell (R-Ky.) has indicated that he prefers a comprehensive tax overhaul.

Roger that. The business community is willing to support a small, one-time gimmick that will cost them around $200 billion or so—and free them to repatriate all their foreign earnings and bring that money back to the US—but only if it’s tied to a large, permanent corporate tax change that will save them far more in the long run. Suddenly it all makes sense.

The devil is in the details, of course, and those won’t be available for months. If the final bill is revenue neutral on corporate taxes, maybe this is a decent short-term dodge. If it cuts corporate taxes significantly, then not so much. Stay tuned.

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Highways Are Now Being Held Hostage to Lower Corporate Taxes

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Could the GOP-controlled Congress actually raise the gas tax?

by Jonathan Davidson Posted on January 6, 2015

Could the GOP-controlled Congress actually raise the gas tax?

By on 6 Jan 2015commentsShare

Thanks to low gasoline prices, the average American family is expected to spend at least $550 less on gasoline this year than in 2014. Meanwhile, our country’s transportation infrastructure is crumbling after years of underfunding. Why not use some of Americans’ savings on gas to make repairs to the roads they’re using that cheap gas to drive on?

That’s the idea behind raising the federal gas tax, a concept being cautiously floated by a few politicians of both parties and a number of advocacy groups on the left and right. America hasn’t raised it since 1993, when it was set at 18.4 cents a gallon and not pegged to inflation. The tax is supposed to fund the U.S. Highway Trust Fund, but it isn’t bringing in enough money, so general treasury funds have been used to partially plug the hole while tens of billions of dollars of needed maintenance work has gone undone. Right now, infrastructure is funded through a short-term fix, implemented last summer, which expires in May.

Republican Sen. Bob Corker (Tenn.) is proposing to increase the tax by 12 cents a gallon over two years, and then index it to inflation. The tax hike would be offset by a decrease in income taxes, or some other means to make the change “revenue-neutral.” Sen. Jim Thune (R-S.D.) told Fox News Sunday that he’s open to at least considering the idea: “I don’t favor increasing any tax. But I think we have to look at all options. … It is important that we fund infrastructure.”

Many business-friendly groups, like the conservative U.S. Chamber of Commerce, favor a gas-tax increase to pay for infrastructure. The Chamber’s Janet Kavinoky told The New York Times that many in Congress are closeted supporters of the tax, but fear retribution if they come out and support the policy publicly.

As New York Times columnist Thomas Friedman put it last month, raising the gas tax would be “a hard political choice” but “a win for the climate, our country and our kids.” There’s increasing talk about raising gas taxes at the state level too.

The president isn’t anxious to raise the federal gas tax, though, as USA Today reports:

The White House is declining to endorse calls for gas tax hikes to pay for new road and bridge construction, but will look at anything Congress approves.

White House spokesman Josh Earnest says the administration wants to stick with its original plan to finance new infrastructure spending with revenue to be gained by closing tax loopholes that favor the wealthy.

And some politicians on the right continue to vehemently oppose a gas-tax hike, whether it’s offset or not. They say it would be fine to let the Highway Trust Fund go bankrupt, arguing that infrastructure maintenance should be left up to state and local governments, not the feds.

So a gas-tax increase might be more likely now than it was a few months ago, but not a lot more likely.

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Could the GOP-controlled Congress actually raise the gas tax?

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Here’s the Easiest Way to Fund the Interstate Highway System: Just Restore the Damn Gas Tax

by PierresHood Posted on April 30, 2014

Mother Jones

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With a few exceptions, the interstate highway system is blissfully toll-free. That may be about to change:

With pressure mounting to avert a transportation funding crisis this summer, the Obama administration Tuesday opened the door for states to collect tolls on interstate highways to raise revenue for roadway repairs.

….The question of how to pay to repair roadways and transit systems built in the heady era of post-World War II expansion is demanding center stage this spring, with projections that traditional funding can no longer meet the need. That source, the Highway Trust Fund, relies on the 18.4-cent federal gas tax, which has eroded steadily as vehicles have become more energy efficient.

….With the trust fund about to run into the red and the current federal highway bill set to expire Sept. 30, Congress cannot — as its members often note — keep “kicking the can down the road.”

Hold on. It’s true that we’re using a bit less gasoline than in the past. But that’s not why the Highway Trust Fund is in dire shape. It’s in dire shape because the federal gas tax has been cut nearly in half since it was last changed two decades ago. In 1993 dollars, it’s now about 11 cents per gallon. If it had just kept up with inflation, highway funding would be in fine shape.

Now, there’s arguably a good reasons to allow tolls. Basically, it makes driving on interstates more of a pain in the ass, which probably means marginally less driving on interstates. And less driving is good for the planet. So if you think that making it less convenient to drive is a good idea, tolls might help.

But you know what else would cut down on driving? Gas taxes restored to 1993 levels. So what’s the point of dicking around instead with tolls and corporate tax reform and all that? The answer, of course, is Republicans, who have sworn a blood oath never to raise taxes, even if “raising” actually means “keeping them at the same level.” So instead of just bumping up the gax tax by a dime or two and then indexing it to inflation—no muss, no fuss—we’re going to play a bunch of idiotic and annoying games merely to keep our roads in decent repair.

Thanks, Republicans. I appreciate it.

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Here’s the Easiest Way to Fund the Interstate Highway System: Just Restore the Damn Gas Tax

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