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States consider increasing gas taxes

By   /   March 18, 2013  /   Comments

Written by Betsi Fores of the Daily Caller News Foundation

If you’ve ever felt the pain at the pump from filling up your tank and wanted to decry big oil, your anger would be misplaced.

Image from Flickr, by “futureatlas.com” in community commons license

That’s because a larger and larger chuck of change out of every gallon of gas you buy is tax going to the government.

Many states have increased gas taxes as a way to increase the tax revenue and shore up budget shortfalls, and use the revenues to fix transportation infrastructure projects that are long overdue.

Earlier this year, Wyoming increased its tax per gallon from 14 cents to 24 cents, the first increase the state has implemented in 15 years. The increased revenue is expected to raise $47.4 million for highway work, and goes into effect in July.

Governors of Pennsylvania, Maryland, Michigan and Vermont have also proposed raising the consumption tax on placed on gas. The state legislature in New Hampshire will hold a hearing Thursday to considering phasing in a 15-cent-per-gallon increase.

The anti-tax advocacy group of Maryland, Change Maryland, expressed outrage over their governor’s plan to increase the tax on gas, which would make it the highest in the region and put their local petroleum companies at a competitive disadvantage.

“There will be more soccer moms buying clothes in Delaware, more commuters filling up in Virginia and more delivery businesses getting diesel in any of our neighboring states,” the group’s Chairman Larry Hogan said in a statement. “With this latest fuel tax proposal, [Governor] O’Malley further validates the decision of thousands of taxpayers and their dollars to save money by leaving the state.” Critics of the gas tax say that this is the wrong time to be charging consumers for a good that is considered as necessary as food and shelter.

“It’s understandable that drivers don’t want to see gas prices go any higher, but they also don’t want to see congestion and road conditions get any worse,” Carl Davis, an expert on state taxation at the liberal-leaning Institute on Taxation and Economic Policy, said to Reuters.

As an increasing number of consumers turn to more fuel efficient cars, revenue from tax on gasoline has decreased. Increasing the gas tax in one way for states to recoup money lost due to this trend and cover budget gaps for road and infrastructure projects.

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