Gas tax suspension would erode infrastructure funding, roadbuilders say

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Diving brief:

  • In an effort to blunt the effects of high gasoline prices across the country, six Democratic governors have called for a pause on the federal gasoline tax of 18.4 cents per gallon through the end of 2022.
  • However, the American Road & Transportation Builders Association said the measure could dismantle the revenue structure and transportation funding in the Infrastructure Investment and Jobs Act.
  • It’s because The law project would authorize the Treasury Department to use general fund dollars to replace temporarily lost revenue from the discontinued gas tax. Since the Highway Trust Fund is loaded with an additional $118 billion from the Infrastructure Investment and Jobs Act (IIJA), its supporters say the Federal Highway Administration can afford it.

Overview of the dive:

Governors who have signed a support letter February 6 for passage of the Gas Price Relief Act include:

  • Tony Evers from Wisconsin.
  • Michigan’s Gretchen Whitmer.
  • Minnesota’s Tim Walz.
  • Jared Polis from Colorado.
  • Michelle Lujan Grisham from New Mexico.
  • Tom Wolf of Pennsylvania.

House Democrats introduced a flanking measure on Feb. 18.

“The ability of the Trust Fund to finance the construction and maintenance of roads, bridges and highways across the country would not be diminished by the legislation,” the letter states. “For these reasons and more, we know it is possible to invest in infrastructure and provide meaningful relief to consumers at the pump.”

Gasoline prices are more than $1 a gallon higher than this time last year, according to AAA datadue to the ongoing pandemic is overdue and in recent weeks, Russia’s war against Ukraine. Adding to the pain: wages are not keeping pace with inflation.

Despite soaring prices, ARTBA opposes the break on the grounds that it would reduce the capacity of the historic Infrastructure Act. In a letter to Senate leaders, ARTBA Chairman David Bauer called the legislation “myopic and misguided”.

Although there has been no movement on the law since its inception, a few states have addressed the issue with their own legislation aimed at relieving pump pain. On Friday, Maryland suspended its 36.1-cent-per-gallon gasoline tax and 36.85-cent-per-gallon diesel tax for 30 days, and Georgia suspended its 29.1-cent-per-gallon tax. on gasoline and the 32.6 cent tax on diesel. tax per gallon on diesel fuel until the end of May, according to CNN.

Additionally, Florida will suspend gas tax in October, a low month for tourism, as California considers a $400 gas rebate and other states consider consider similar measures

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