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U.S. Chamber Of Commerce Proposes 25 Cent Gas Tax To Fund Infrastructure Investments


With President Trump and Congress turning their attention to infrastructure in the coming weeks, the U.S. Chamber of Commerce is preparing for an uphill battle: a push to raise the federal gas tax by 25 cents per gallon to help pay for the initiative.

The proposal, which will be formally introduced later this week, is part of a series of principles the nation’s largest business lobby will offer in a bid to help shape the debate about upgrading U.S. roads, bridges, airports and other critical infrastructure.

Chamber President Thomas J. Donohue said his organization wants “to put our oar in the water” and acknowledged that it would be “a tough vote” to raise the gas tax for the first time since 1993. But he said that support has been building in the business community and elsewhere.

“I’ve been pushing this for a long, long time, but now gangs of people are pushing it,” Donohue said in an interview in which he also said immigration reform would be critical to ensuring that sufficient labor is available for public works projects.

Trump said an infrastructure bill was a priority of his first 100 days in office – and one with potential for bipartisan support – but it was put on the back burner amid other bruising legislative battles over health care and tax restructuring.

The White House has pledged to introduce its vision of a bill before Trump’s State of the Union address this month.

In private meetings, Trump has floated the idea of raising the federal gas tax by as much as 50 cents per gallon but received a chilly reception to that idea, particularly from Republican lawmakers. Still, aides say, the idea of an increase hasn’t been taken off the table.

As envisioned by the chamber, the 25-cent increase would be applied to the current taxes of 18.4 cents per gallon for gasoline and 24.4 cents per gallon for diesel fuel. It is estimated that the increased levy would raise more than $375 billion over the coming decade, chamber staff members said.

That is significantly more than the White House has suggested that the government should pump into an infrastructure initiative. Administration officials have said publicly for months that they think that $200 billion in additional federal money could spur at least $800 billion more spending by state and local governments and the private sector.

In its last budget proposal, the White House said the government’s $200 billion share could be paid for with cuts in other programs.

Part of the federal funding would be used to reward states and localities that raise taxes or other revenue to fund infrastructure in their jurisdictions. The White House also is looking at grants for new projects in rural areas and money for “transformational” work such as plans to build tunnels for high-speed trains.

Donohue said he hopes that with Trump’s support, Congress can come up with a meaningful measure to address what the chamber considers a long-overdue priority.

“We just got a new tax bill for the first time in 31 years,” Donohue said. “We’re making some significant changes in regulatory reform. We’ve got a president – everybody’s got all their own views about him and what he stands for and all that – but the guy’s getting stuff done . . . and he’s a builder. I think we can get some help here.”

Donohue said the chamber also plans to offer ideas to encourage additional private investments in infrastructure projects, including expansion of existing federal loan programs. And he said the chamber shares Trump’s goal of streamlining the permitting process for highways and other projects, including at the local level.

“It’s not worth spending the money to do this or the time if we don’t fix the permitting deal,” he said.

Donohue also sought to make the case for addressing immigration policy in a way that ensures sufficient labor to construct the array of projects that could be funded. That includes “a fix” to the Deferred Action for Childhood Arrivals program that Trump wants canceled, Donohue said.

“We don’t need this the day we do a bill,” he said of immigration changes more broadly. “We need it as we ramp up to start building the stuff we’re talking about.”

The chamber also plans to call for other steps to enhance the workforce, including advancing recommendations on apprenticeships developed by a Labor Department task force.

Source: AgriMarketing

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