Calls in Pennsylvania, New Jersey for higher gas taxes

Posted: December 04, 2012

Gasoline taxes, unloved by motorists but invaluable for cash-hungry governments, could be raised as states and Congress scramble for more transportation funding.

Gov. Corbett said last week he is mulling an increase in one component of Pennsylvania's gas tax. In New Jersey, transit advocates are urging Gov. Christie to relent on his no-gas-tax-hike vow as a way to help pay for repairs to a transportation network ravaged by Hurricane Sandy.

And in Congress, the new chairman of the House Transportation Committee, Rep. Bill Shuster (R., Pa.), said last week "we need to explore" all funding options, including a higher gas tax.

Revenue from gas taxes has been sliding as people drive fewer miles and more efficient vehicles. And inflation has whittled away at the value of the taxes, some of which have not been raised in decades.

The federal gas tax, last increased in 1993, is 18.4 cents a gallon.

The Pennsylvania tax is 31.2 cents a gallon (32.3 cents if you count the 1.1 cent-per-gallon underground storage tank fee, which the state Revenue Department doesn't but the American Petroleum Institute does). It last went up in 1997.

In New Jersey, the tax is 14.5 cents a gallon (including the 4-cents-per-gallon "petroleum products gross receipts tax"). It hasn't been raised since 1988.

The costs of maintaining highways, bridges and transit systems have outstripped the ability of state, local and federal governments to pay for them, and the policymakers are looking for new sources of revenue - such as tolls on more roads - or boosts in existing taxes like the gas tax.

A report in October by the Delaware Valley Regional Planning Commission said the nine-county Philadelphia region spends about $1.4 billion a year on highway, bridge, and transit projects, while the annual need is about $2.5 billion.

Corbett said last week he would consider removing the cap on the oil company franchise tax, which is one of two main components of Pennsylvania's gas tax. It is levied on wholesale price of gas, capped at a price of $1.25 per gallon.

Since the wholesale price is now up to about $2.70 a gallon, removing the cap could produce about $1.4 billion a year.

If the increase were passed on to motorists, that would mean a gas tax increase of 22 cents a gallon, which an advisory commission created by Corbett last year recommended be phased in over five years, at 4.4 cents per year.

In New Jersey, transit advocates such as Sierra Club director Jeff Tittel have called for a 10-cent-a-gallon increase in the gas tax, now the third lowest in the nation.

Janna Chernetz, of the Tri-State Transportation Campaign, said Christie's opposition "is really unfortunate . . . because we're not investing enough in transit."

"The conversation has to start in Trenton," she said, "and everything has to be put on the table."

Nick De Palma, of the New Jersey Gasoline-C-Store-Automotive Association, argued against any increase, saying a "low gas tax is one of the few areas where New Jersey is competitive."


Contact Paul Nussbaum at 215-854-4587 or pnussbaum@phillynews.com .

comments powered by Disqus
|
|
|
|
|