Wrong idea on gas tax
Gas prices are going up, and right on cue, some politicians are suggesting New York suspend its gasoline tax to ease the pain for motorists.
Of course they are. It’s one of those ideas sure to burnish a politician’s populist credentials. It’s also one of those ideas you’ll rarely hear from a responsible elected official who’s actually in charge of making government function, and for good reason. It’s recklessly simplistic, one of those unicorns of anti-taxers.
It’s not that we don’t sympathize with the pain people are feeling when at the pump or when the heating fuel oil delivery truck comes. We’re feeling it, too. A gallon of gas is averaging about $3.32 nationally, according to the U.S. Department of Energy. A year ago, it was $2.15. Even by pre-pandemic standards, too, prices are high; gas was going for $2.57 a gallon in January 2020.
Of course, there are a lot of variables in play. People weren’t driving very much last year, and oil prices plunged. Demand has been surging as society reopens, and as more people get vaccinated and feel safer getting out for
things other than a trip to the grocery store or doctor or other essential matter. The market has also been suffering from U.S. refinery shutdowns during hurricane season, OPEC’S slow increase in output, and relatively low global investment in new drilling.
In a grandstanding response to the rising prices, state Senate Republicans staged a news conference at a Rochester gas station this week to ramp up their call for the state to suspend its gas tax. They also once again attacked the state’s landmark 2019 Climate and Community Investment Act, which they’ve long objected to because it will likely lead to some form of carbon tax that will raise prices for dirtier fossil fuels as a way of encouraging more people and businesses to move to cleaner energy sources. As for the revenue the state would lose from the tax, they argue it can just come out of the state’s surplus.
This simplistic approach ignores some critical realities. Those roads and bridges we’re all driving on more and more need upkeep — which gasoline taxes significantly help pay for. Yes, the state could tap its surplus, but there are a lot of demands on any extra money the state has right now, including the need for an emergency reserve. Rising gas prices may be a major annoyance for many and a genuine burden for some, but they’re not a state emergency.
The responsible way to deal with this is to ensure that the state and federal governments fully fund — and increase funding if necessary — for forms of assistance that can help lowincome people, especially with heating costs. And to build safeguards into a carbon tax, as advocates have proposed and critics conveniently ignore — such as passing much of the new revenue back to customers and allowing them to use it to pay for cleaner energy.
The irresponsible way to do this is to keep trying to make fossil fuels as cheap as possible to the detriment of the state budget, its rainy-day fund, its road and bridges, and the planet we need to live on.