Just when you thought Louisiana’s politicians would give their tax-raising ways a rest, a bill has been filed that would close to double the state’s gas tax.
State Rep. Steve Carter, a Baton Rouge Republican, has introduced a bill that would eventually raise the tax at the pump from 20 to 38 cents. The 38 cents would be on top of the 18.4 cents motorists already pay in a federal sales tax per gallon.
Louisiana already has the highest combined state and local sales tax in the nation. That does not include the state’s gas sales tax.
Carter’s bill leaves no motorist behind. It would also establish a $300 fee on electric cars and $200 on hybrids. The tax man cometh, and he’s thorough.
There’s also currently a push in Congress to raise the federal gas tax by 25 cents. Last year, President Donald Trump, a Republican, said he’d consider the increase to help fund the nation’s deteriorating infrastructure needs.
If Congress and the Louisiana Legislature go through with their double whammy gas tax increases, motorists will end up paying 80 cents per gallon in taxes. The average American uses 500 gallons of gas per year, meaning the typical Louisiana motorist will spend $400 a year in federal and state taxes at the pump.
John Bel Edwards, a Democrat, has already raised taxes as governor more than $7 billion. He thinks any gas tax bill will die during the session.
But Carter believes his bill has a chance despite it being an election year.
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“We have a broad cross-section of support. The coalition has been talking this up, and people on both sides of the aisle recognize we need to do something to fix our highways,” said Carter.
John Kay, state director for the conservative Americans for Prosperity, calls Carter’s bill “just another tax increase on the Louisiana people.”
“The state should look at public/private partnerships as a pathway forward rather than continuing to raise our taxes, as well as to clean up how the gas tax money is currently being spent,” he said.
Kay believes the existing gas tax should go exclusively toward road and bridge improvements and major projects. Currently, a percentage of it goes to pay for the salaries and benefits of state employees at the Department of Transportation and Development. Kay says that expense should come from the state’s general fund.
Robert Poole with the libertarian think tank, the Reason Foundation, argues Louisiana should meet its badly needed infrastructure problems with tolls instead of raising the gas tax.
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“With a gas tax increase, the voter can be sure of only one thing: paying more to drive, every day, every mile. With tolls applied to specific projects, the voter can be sure of never paying a toll unless the new or rebuilt highway or bridge improves the voter’s travel and is a good value for the money spent, “ wrote Poole.
Louisiana currently has only three tolls: The Highway 1 Bridge from Golden Meadow to Port Fourchon, the Avery Island bridge and the Lake Pontchartrain Causeway.
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Ken Perret with Louisiana Good Roads and Transportation Association, an organization representing mostly companies involved in road construction, argues the state’s traffic volumes aren’t large enough to make tolls financially viable.
“Toll financing and private-public partnerships need to be considered where appropriate, but only an increase in the gas tax, which is paid by highway users, will generate the funds needed to fix our deteriorated roads and bridges, “ wrote Perret.
Our state’s infrastructure repair needs are considerable. But tax increases in the past three years have forced the private sector to absorb the loss of more than $7 billion. Louisiana was dead last in GDP growth in 2017. Our state’s GDP growth was 44th most recently, according to a report released in February by the U.S. Bureau of Economic Analysis.
Fuels costs are often enormous for businesses. When fuel prices rise, it can hit businesses hard. Doubling the state gas tax is sure to impact the bottom line of many businesses, both small and large. Politicians would be wise to consider the health of the economy when determining how to meet the needs of state government.
Email Dan Fagan at firstname.lastname@example.org. Twitter: @DanFaganShow.