Gas tax increase sounds unlikely as part of Biden infrastructure plan

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WASHINGTON — U.S. President Joe Biden raised the prospect of a gas tax hike during a meeting with lawmakers to point out it would not raise a lot of money and explain why he did not favor it as a way to pay for his infrastructure proposal, a White House official said on Monday after media reports.

A reporter for ABC News had said earlier on Monday on Twitter that Democratic U.S. Representative Donald Payne had said Biden expressed an openness to raising the tax during the meeting.

The Biden administration is proposing several measures, including a substantial overhaul of the U.S. corporate taxation system, to pay for the president’s $2.3 trillion infrastructure and job creation package, which includes large investments in clean energy and electric vehicle technology.

Transportation Secretary Pete Buttigieg last month said the White House will not propose hiking gas taxes or a new vehicle miles traveled (VMT) fee to pay for the investments. The White House has also insisted that no one earning under $400,000 a year will see their taxes go up.

Excluding a possible gas tax hike — which would affect people earning under $400,000 — will make it harder to raise the funds needed to bankroll Biden‘s ambitious infrastructure package, experts say, with many U.S. business interests already blasting a proposed hike in corporate tax rate from 21% to 28%.

Congress has not boosted the 18.4-cents-per-gallon federal gasoline tax since 1993. That tax is now worth just 10.2 cents after adjusting for inflation, and an increase is seen as potentially garnering bipartisan support.

Leonard Burman, a fellow at the Tax Policy Center think tank, said a gas tax hike was “the rare tax increase that has some bipartisan backing” and eliminating it would complicate his effort to raise new revenues.

Since 2008, Congress has transferred about $141 billion to the Highway Trust Fund, according to the Government Accountability Office, to pay for road repairs rather than rely on gas tax revenue.



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Saurabh Shukla

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