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    Gas Taxes in the US - something for advocates to consider

    I just looked at the Wikipedia entry on fuel taxes, and saw the following (http://en.wikipedia.org/wiki/Fuel_ta..._United_States).

    US Average $0.47/gal (includes federal and state taxes) as well as this
    A 2003 Federation Highway Administration study found that 94% of federal roadway funding came from fuel taxes, 86.3% of state roadway funding came from fuel taxes, and 11.1% of local roadway funding came from fuel taxes.

    The study found that altogether in the U.S., 69.6% of roadway funding ($79.6 billion) came from fuel taxes and 30.1% ($33.4 billion) from other funding sources.


    So, if gas taxes are raised to make them the sole source of road funding, we're looking at an additional tax of around $0.141 per gallon. Not a large number, and not a number that would change behavior to any significant extent. If we add a "fudge factor" to account for possible reduced consumption and inflation (since the study was conducted in 2003) and make the additional tax $0.20/gal, we still would not have a price that would drastically alter behavior.

    So, how did/do the European countries justify their sky-high gas taxes? Political feasibility aside, surely there was/is some justification besides just making drivers pay for the road. IIRC even if we add the classic "greenhouse gas" tax (justified based on Carbon prices) on top of everything, we'd still be at around $0.30/gal or so; still no dramatic change in behavior expected.

    Ultimately, my guess is that something other than the relative high cost of driving will be needed to get people to ride more.
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    rwp
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    I'm not sure why the country needs to 'justify' tax levels based on the costs of providing specific services to support specific activities. If that were the case, they would be called 'user fees' rather than taxes. We all pay income taxes that vastly exceed the governments costs to support workplace related expenditures. Why should gas taxes be somehow limited to what the government spends on roadways?

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    Senior Member Laserman's Avatar
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    Quote Originally Posted by Ngchen View Post
    <snip>
    So, how did/do the European countries justify their sky-high gas taxes? Political feasibility aside, surely there was/is some justification besides just making drivers pay for the road. IIRC even if we add the classic "greenhouse gas" tax (justified based on Carbon prices) on top of everything, we'd still be at around $0.30/gal or so; still no dramatic change in behavior expected.

    Ultimately, my guess is that something other than the relative high cost of driving will be needed to get people to ride more.
    I worked for a German company and spent about a year there over a 3 year period. One thing I noticed right away was that German roads were much better quality than American roads. I mean MUCH better. The Germans at least get a quality product for the taxes they pay and the same is probably true of other European countries.
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    Instead of hiking gas tax, why don't we just tax motorists based on their vehicle useage. This would greatly benefit tax receipts on local levels.


    H23NC,

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    Senior Member hshearer's Avatar
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    Also, what does roadway funding mean? Just the costs to build the road? Ongoing maintenance is another cost to consider that should certainly be funded by gas tax. I think it would also be fair to include the costs of a certain portion of policing and emergency services due to motor vehicle use.

    A little more extreme, but possibly gas tax should be used to pay the environmental costs of motor vehicle use, as well.

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    genec genec's Avatar
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    Am I reading this right? Federal roadway funding.... isn't that the Interstate freeways that for the most part cyclists are not permitted to use anyway?

    Local roadways are surface streets, right? Only 11% or so of gas tax goes into roadways that cyclists use apparently.

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    Quote Originally Posted by H23Nutcase View Post
    Instead of hiking gas tax, why don't we just tax motorists based on their vehicle useage. This would greatly benefit tax receipts on local levels.


    H23NC,
    States have gas taxes too. The gas tax is about as perfect a tax on road usage as you're going to get. Collection is trivial and efficient. Granted, people that have obnoxiously large vehicles pay more tax, but there is a significant societal cost of having excess oil consumption as well. The idea that we're all going to pay hundreds of dollars for a gps tracking system for a road use tax but we will not pay another 25 cents a gallon seems crazy to me.

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    genec genec's Avatar
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    Quote Originally Posted by unterhausen View Post
    States have gas taxes too. The gas tax is about as perfect a tax on road usage as you're going to get. Collection is trivial and efficient. Granted, people that have obnoxiously large vehicles pay more tax, but there is a significant societal cost of having excess oil consumption as well. The idea that we're all going to pay hundreds of dollars for a gps tracking system for a road use tax but we will not pay another 25 cents a gallon seems crazy to me.
    Exactly... gas tax directly relates to road use, why try any other scheme. Further, rather than a flat rate tax, it should be a percentage, to allow for an increase in tax as the price of oil fluctuates.

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    Back in 1979 Jimmy Carter suggested a $.50 gas tax. At that time gas sold for about a dollar. Though his proposal never went anywhere except into opposition ads, a 50% gas tax seems about right to me for 2010, gradually increasing to to 100% by 2020. Congress can get to work on this following their unanimous approval of immigration reform.
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    If we're using that wikipedia article as point of reference:

    A 2003 Federation Highway Administration study found that 94% of federal roadway funding came from fuel taxes, 86.3% of state roadway funding came from fuel taxes, and 11.1% of local roadway funding came from fuel taxes.
    Local roadway funding... What roads to cyclists use?
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    From what I've read, European roads are better because of the way road standards are written. If federal funding is being used for a U.S. road project, the lowest bid that meets minimum road standards needs to be selected; there is no option to get a better surface for more money, even if the life cycle cost (i.e., cost of the road plus maintenance over the life of the road) is lower. European countries, I think, contract based on providing a road surface of a certain quality over a certain time period (i.e, they use life cycle cost in their procurement process), so the contractors have an incentive to use longer-lastig material surfaces. They could be used in the U.S., but they cost more than the "mininum standard" so they never win the contracts.

    Also, gas taxes in Europe are structured to be a disincentive to driving, at least driving gas guzzlers. The result is cars that are far more fuel efficient, and yet in my experience they are just as much fun to drive. Euro engines are tuned for a broader peak in the torque curve which results in more power at lower rpms, so even with a "less powerful" engine, it doesn't feel lacking. American engines are tuned to have a very high HP rating at the expense of having a very narrow power band. That way automakers can brag about how much power the cars have, even though the power may not be in a range you would use in relatively come driving.
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    rwp
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    Quote Originally Posted by Doohickie View Post
    From what I've read, European roads are better because of the way road standards are written. If federal funding is being used for a U.S. road project, the lowest bid that meets minimum road standards needs to be selected; there is no option to get a better surface for more money, even if the life cycle cost (i.e., cost of the road plus maintenance over the life of the road) is lower. European countries, I think, contract based on providing a road surface of a certain quality over a certain time period (i.e, they use life cycle cost in their procurement process), so the contractors have an incentive to use longer-lastig material surfaces. They could be used in the U.S., but they cost more than the "mininum standard" so they never win the contracts.
    Although it's true that low bids are most often chosen for US road projects, each state is free to design and spec roads to higher standards if they so choose, even when partially funded by federal money. Most state highway agencies are chronically short of cash so it's hard for them to put up extra money in the present for higher construction standards in return for cost savings in the future due to better road performance.

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    Seņior Member ItsJustMe's Avatar
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    If road projects were bid out in the US as having to last a certain length of time, corporations would just spin off a company to do the construction, rent the equipment to itself, take the funds out then dissolve the company, leaving nobody to sue when the road started falling apart. And the legal system (with proper palm greasing from the construction industry) would let them get away with it.
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    Quote Originally Posted by ItsJustMe View Post
    If road projects were bid out in the US as having to last a certain length of time, corporations would just spin off a company to do the construction, rent the equipment to itself, take the funds out then dissolve the company, leaving nobody to sue when the road started falling apart. And the legal system (with proper palm greasing from the construction industry) would let them get away with it.
    Ain't that the truth! NC has recently spent several million (tens of millions actually) redoing roads that were either designed incorrectly or the contractor went Tango Uniform. Unfortunately in an effort to "save" money the state has not been requiring warranties on road work. That only works if it you properly design and monitor the installation.

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    Gas taxes should also be used to fund public transit, hospital costs resulting from road injuries, replace the annual vehicle registration fee, and public liability insurance. This would provide incentive to only use the car when you really need it.

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    http://www.fhwa.dot.gov/policy/2006cpr/es06h.htm

    These numbers indicate that gas taxes only pay 38% of road costs, and all road taxes pay about 69% of road costs. So, the gas tax would have to be nearly doubled to make up the gap.

    Wikipedia also lists an awfully low number for roadway funding. I think they've misread the study.

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    Quote Originally Posted by AndrewP View Post
    Gas taxes should also be used to fund public transit, hospital costs resulting from road injuries, replace the annual vehicle registration fee, and public liability insurance. This would provide incentive to only use the car when you really need it.
    It does pay for public transit subsidies, actually.

    Since most people have liability coverage (although often too small among the drivers most likely to cause damage it seems) they also have "public liability insurance."


    I strongly disagree with raising gas taxes in the US. It kills a very sound argument about why bikes do pay their way, assuming you're not homeless and broke. The moment we let cars pay their own way is the moment they finish taking over.

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    Quote Originally Posted by unterhausen View Post
    States have gas taxes too. The gas tax is about as perfect a tax on road usage as you're going to get. Collection is trivial and efficient. Granted, people that have obnoxiously large vehicles pay more tax, but there is a significant societal cost of having excess oil consumption as well. The idea that we're all going to pay hundreds of dollars for a gps tracking system for a road use tax but we will not pay another 25 cents a gallon seems crazy to me.
    Seems pretty unnecessary. We already have regulations about odometers. Just check the odometer at each registration. I think a gas tax is a better plan in a country that imports most of its fuel though.

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    Al noisebeam's Avatar
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    Quote Originally Posted by crhilton View Post
    Seems pretty unnecessary. We already have regulations about odometers. Just check the odometer at each registration. I think a gas tax is a better plan in a country that imports most of its fuel though.
    What about trips to Mexico, Canada and on private property?

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    Sophomoric Member Roody's Avatar
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    The reason countries impose such large fuel taxes is to encourage people to use less fuel.

    I would like to see a $4/gal. gas tax. Then give every taxpayer an $80/week payroll tax credit. (This is a "revenue neutral tax." It is strictly to change behavior, not raise money.)


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    Senior Member Seattle Forrest's Avatar
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    Quote Originally Posted by H23Nutcase View Post
    Instead of hiking gas tax, why don't we just tax motorists based on their vehicle useage. This would greatly benefit tax receipts on local levels.
    How would that actually be different? You use your car more, you need to put more gasoline through it. You use it less, you need less gas, you pay less in gas tax.

    The only (subtle!) difference I can see is that the Prius owner can drive the same number of miles than the Hummer owner, and pay less for it. Or, another aspect of the same difference, is that a person could avoid driving on crowded freeways at rush hour, achieving better mileage, and pay a slightly lower tax. But since we're trying to realize better fuel efficiency and less congestion anyway, these are positive outcomes.

    Putting a GPS in every car to track actual mileage for tax purposes will get virtually the same results as a gas tax, but at far greater cost, and also will annoy privacy advocates. Isn't it a bit like saying "Oranges are unacceptable. We need navel oranges!"

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    Quote Originally Posted by H23Nutcase View Post
    Instead of hiking gas tax, why don't we just tax motorists based on their vehicle useage. This would greatly benefit tax receipts on local levels.
    H23NC,
    What do you think a gas tax does? More driving = more gas = more taxes....duh!

    US vs. Euro is apples to oranges. US is a much larger country and very spread out. Many people commute 1 hr or more to get to work. We who ride our bikes (few more than 15miles) are the lucky ones and in a very small minority. Gas tax hurts the people who have to make that long commute, many because the opportunities for jobs are limited and they have responsibilities to others.

  24. #24
    Primate Metzinger's Avatar
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    Quote Originally Posted by sm1960 View Post
    What do you think a gas tax does? More driving = more gas = more taxes....duh!...
    Not if it's made revenue neutral as per Roody's suggestion. Then it's a dissuasion from driving and resultant promotion of other forms of transport.
    US vs. Euro is apples to oranges. US is a much larger country and very spread out
    That the EU is half the area of the US is largely irrelevant. It's the sizes of the cities that matters. If North American cities are interested in sustainable footprints, they need to become higher density. Discouraging car usage is part of that.

  25. #25
    Senior Member Richard Cranium's Avatar
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    This is a curious subject for a cycling forum. Actually, any tax, by its very existence cannot be equally fair or neutral to its results since the concept of a tax in itself is to "share" burden.

    Something I wish I could get people to understand is the complexity of how to fairly distribute a dwindling natural resource in a manner that can still allow for the "reward" of wastefulness of activity or leisure-earned through social responsibility in other areas.

    In other words, what the young people among us are going to live long enough to see is: some people nearly freezing for want of heating fuel - while others among us expend the same resource to "jet set" about the planet for fun and relaxation.

    This is the greatest argument supporting government regulation and the restriction of "open market" resource consumption. Yet, if those that are "jet setting" are going to Denmark to "fix" global warming, should they be stopped? Or should they only be stopped if they are going to Disneyland?

    In yet other words, to understand this problem, think of a huge desert and a group of people where some use up the water to swim, while other are nearly dying of thirst.

    The "problem" associated with governing fairly in the face of resource consumption is in determining the "social redeeming value" of the activity and practices associated with the resource consumption.

    Good luck with that.

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