I continue to read about the significant budget deficit that our state is facing, and, unfortunately, there seems to be much more emphasis on increasing revenues rather than trimming budgets. However, I do realize that we cannot save our way to prosperity. While I am sure that there still remain many areas in state government that could use some belt-tightening, the magnitude of the deficit appears to be at a point where some sort of tax increase is going to be necessary.

One can blame excessive spending and poor management of the people’s money, and I would not disagree. These are areas that need to be addressed. Hopefully, the new administration will focus on this, but I’m not holding my breath. The real problem that should be addressed is the huge decrease in state income associated with the drop in oil-related revenues. While we all enjoy paying $1.50 per gallon gasoline, the lower crude oil price is the main reason for our state’s economic problem.

So, why don’t we replace those lost revenues with a “tax” that just comes from the same pocket that it formally came from — our family fuel budget? Let’s place a “variable” tax on gas that would keep the consumer price at somewhere in the $2.50 per gallon range. If gas is selling now at $1.50, the state could capture an additional $1. I think that Louisianians purchase somewhere in the neighborhood of 2 billion gallons per year, so it’s easy to see what a significant difference this could make. As oil prices increase in the future, the tax would decrease, leaving the consumer cost for gasoline at $2.50. If oil gets to the point where gasoline is at $2.50 without the tax, then the tax would be zero. At that point, oil revenues should make up the deficit.

We paid $2.50 and much more in the past and lived with it. We can do this again. Wouldn’t this variable tax be much fairer than an increase in sales tax or abandonment of the homestead exemption? Also, this variable gas tax would go away once oil revenues are back. We all know the other options will be with us forever, even after oil revenues increase. One other added benefit would be that it would be much easier for the state to prepare a budget, with a better idea of oil or gasoline related revenues.

I realize that I have simplified things and that this would take more calculations and also some administrative details. But wouldn’t this address the real issue and not just add another tax that nobody wants? Isn’t this a time to think outside the box?

Tom Burns

retired, Midstream Entergy

Baton Rouge