By on June 19, 2014

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For over two decades, the federal fuel tax has held at 18.4 cents for gasoline and 24.4 cents for diesel per gallon sold. A bipartisan bill working through the United States Senate could soon change this, especially as the nation’s Highway Trust Fund — used for funding infrastructure projects — comes closer to running dry by August of this year.

Reuters reports Sens. Bob Corker of Tennessee and Chris Murphy of Connecticut want to raise both taxes by 12 cents, which would be spread out over two years prior to linking future increases to inflation. The senators also proposed tax cuts to make up for the increase, though nothing was specified at the time.

Meanwhile, some legislators want to fund the trust through a corporate offshore profit tax repatriation holiday that would resemble a 2004 proposal led by former president George W. Bush: 12 months, 85 percent deduction for dividends paid. The Joint Committee on Taxation estimated the holiday would bring in $20 billion during the period, but would lead to expectations for more holidays down the road.

President Barack Obama opposes this method, believing “it would give large tax breaks to a very small number of companies that have most aggressively shifted profits, and in many cases, jobs, overseas,” according to White House representative Jay Carney.

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122 Comments on “Bipartisan Senate Bill To Raise Fuel Taxes For The First Time Since 1993...”


  • avatar
    Tomifobia

    “To raise fuel taxes since 1993″

    I hope that’s a typo, and not the threat of retroactive tax increases.

    • 0 avatar
      Astigmatism

      Ha! Wouldn’t put it past them.

    • 0 avatar

      How about we CAP Congress’ and all other representative’s salary to $100,000 maximum?

      Why should I have to pay a penny more while you people are wasting my tax dollars on shias and sunnis, commies and commy wannabes and other assorted socialists?

      When you’re spending over $40,000 per second it’s no wonder why you are running into money problems.

      • 0 avatar
        carguy

        @BTS Youtube guy: Cutting the compensation of our elected representative only does two things:
        1. It will deter real talent from running for office
        2. It will make elected representatives more susceptible to bribes and kickbacks.

        • 0 avatar

          carguy

          There is no “talent” in Congress.

          These guys are worse trolls than I am – especially when Fox news or MSNBC are present.

          #2 TERM LIMITS is a way to deal with these rich tycoons and people taking money under the table to sell us out to Asia.

          • 0 avatar
            carguy

            No argument about term limits. I would also add the elimination of midterms to the list to stop the endless election cycle. However, cutting the wages of our elected officials will only erode our already shallow talent pool even further.

          • 0 avatar
            28-Cars-Later

            Term limits would make midterms relevant again.

          • 0 avatar
            kkt

            Term limits kick out the good as well as the bad. It takes years to learn the Washington process, who to call for what, etc. If you kick them out as soon as they learn their way around, the winners are not regular people, the winners are the lobbyists. No term limits on lobbyists! And if all the legislators are new, no memory for how what the lobbyists said last time actually turned out.

            Greatly limit campaign contributions and ban ever taking a job with an industry they passed laws about.

          • 0 avatar
            Xeranar

            Term limits actually benefit the party structure and prevent individual candidates from having long-term power. Everybody complains about other people’s elected officials. If people were actually as upset as they sound with their own they would act differently.

            As for keeping the pay down, you mind as well be spitting into the ocean. The biggest issues is the continual shifting of the tax burden from corporations to the individual citizens and the reinforcement of ‘free trade’ which rewards low-wage non-democratic countries.

        • 0 avatar
          danio3834

          1. I’m not really interested in purchasing most of their talents.
          2. Curtail their power so there’s little incentive to bribe them.

          Of course reducing Congressional pay and power would require an act of Congress, so neither are likely to happen. Ever.

          • 0 avatar
            carguy

            “I’m not really interested in purchasing most of their talents”

            You should be. Foreign policy, defense and national economic policy are serious matters that require a functioning government. Countries with no government tend to look like Somalia so let’s skip that option.

          • 0 avatar
            thornmark

            >>2. Curtail their power so there’s little incentive to bribe them.
            <<

            Bingo! So long as they have inordinate power, people will try to influence them.

            Look at the exPrez who has accrued $150 million selling influence, that should be a major scandal.

          • 0 avatar
            redav

            “2. Curtail their power so there’s little incentive to bribe them.”

            2a. Make penalties for bribes and unethical behavior so severe and difficult to avoid that they question their career decision in fear they might get caught.

          • 0 avatar
            Landcrusher

            You are correct. Not going to happen. If we want crazy schemes, we should raise their pay, put all all their wealth in a fixed income account, and forbid them from any outside income. They aren’t getting rich on their salaries, but they all seem to be getting rich.

          • 0 avatar
            danio3834

            >You should be. Foreign policy, defense and national economic policy are serious matters that require a functioning government. Countries with no government tend to look like Somalia so let’s skip that option.

            I put the *most* in there instead of *all* to hopefully avoid the predictable Somalia knee-jerks.

      • 0 avatar
        JCK

        Yup. Let’s make impossible for anyone but the independently wealthy to run for office. I’m sure that will fix everything.

      • 0 avatar
        ClutchCarGo

        Unless you also restrict lobbying in an iron-clad way (probably not legal), term limits won’t change things much. The only way to make them genuinely responsive to the voters is to prevent them from drawing districts to protect incumbents of both parties. If districts were really contestable we would see a big change in lawmakers’ attitudes.

        • 0 avatar
          Xeranar

          This is something that is worthwhile discussing and is beginning to pick up steam in certain political circles. The fact that most districts regardless of political ideology are drawn to be relatively safe for the dominant party makes it easy for the most radical candidates to win and cruise to victory. If we pressed every district to be near 50/50 in registered party members or atleast proportional it would be a much more ideological fight rather than just seeing how far one can go to the base’s view to win.

          Course, I also advocate for doubling if not tripling the number of representatives in the house because as it stands rural areas are heavily over-represented and urban areas are under-represented. It isn’t just that my political views favor it but it makes democracy work better if everybody would be represented in a more honest way, 750K per rep is high, higher than the total population in Wyoming and proportionally too high. It should be no higher than 500K and more appreciably 250K. It would also make it more difficult to dominate ad space in media markets because you would be facing 3-6 districts within a single market that helps to keep big spenders from flooding the airwaves for one dominant district.

      • 0 avatar
        jim brewer

        Yeah. Stuff should be free.

  • avatar
    VoGo

    Great phrasing: “corporate offshore profit tax repatriation holiday.”

    That doesn’t sound anything like welfare for rich corporations.

    • 0 avatar
      dwford

      Um, this is a way to get companies to pay taxes on earnings that they legally don’t have to. Is your solution to do nothing and let all that money (and lost tax revenue) sit offshore? Or are you waiting for that utopian moment where the companies will see the light and voluntarily pay high taxes to bring that money back – or when an aggressive government can just confiscate it?

      The obvious concern is that the money raised will not go to its intended purpose – roads.

      • 0 avatar
        MAGICGTI

        dwford-Exactly, as with all money collected by the government, us citizens aren’t seeing our donations used efficiently. I read an interview with Danforth Quayle (he’s a neat guy) and in so many words he was frustrated with our infrastructure problem because it’s not a lack of funds, it’s waste, misuse, and the typical government ineffiencies that causes us to come up short of achieving our goal. But repairing a bridge involves several different agencies such as EPA and Army Corps of Engineers, etc. and slows everything down and blows the costs through the roof.

        I certainly support raising the fuel tax, however. The progress that automotive companies have made in fuel economy is remarkable.

        VoGo – Your ideas are great, just not realistic.

        • 0 avatar
          Jeff Waingrow

          Are you kidding? Dan Quayle wouldn’t know a potato from a potatoe.

          • 0 avatar
            CJinSD

            How does that compare with thinking we live in the 57 islamic States of America, which Barrack Hussein Obama claimed to have visited all of?

          • 0 avatar
            chuckrs

            According to blog.Oxforddictionaries.com, the New York Times spelled the tasty tuber like Dan Quayle did as recently as June of 1992. Quayle may be the only person to single-handedly turn a variant spelling into an obsolete spelling in short order.

          • 0 avatar
            Jeff Waingrow

            Even the most innocent humor will rile the embittered among us. Can’t you lighten up even a little? My sympathies to anyone stuck living with you two.

          • 0 avatar
            Pch101

            Bringing it back to cars, Dan Quayle was supposedly instrumental in Cerberus’ acquisition of Chrysler, which ultimately ended in bankruptcy. Funny how that works.

      • 0 avatar
        RangerM

        All corporate taxes are ultimately paid by people, anyway.

        When a corporation pays taxes, it is financed by its customers (through higher prices), its employees (through reductions in wages/benefits), or its shareholders (through reductions in dividends/shareholder equity).

        • 0 avatar
          smartascii

          RangerM – I’m sorry, but this is a misuse of logic to arrive at an end you want. It’s like saying that all individual taxes are ultimately paid by businesses (through reduced consumer spending and diminished profits). Taxes go to governments, and we all know how bad governments are at saving, so ultimately, all taxes are spent to pay people and businesses to provide services to all of us. There’s certainly a discussion to be had about the relative merits and efficiencies of the government’s spending choices, but taxes are not a black hole that remove money from the economy.

          • 0 avatar
            CJinSD

            Taxes concentrate earnings in the hands of cronies and find their way back into the campaign funds of corrupt politicians. They take from the virtuous and creative and give to the thieving and conniving. Lastly, taxes remove capital from productive endeavors and pour them into spreading death and dependence.

          • 0 avatar
            RangerM

            @smartascii

            We may not agree, but I don’t think you’ve interpreted me correctly.

            I’m not arguing the merits/demerits of taxation. All I’m saying is taxes are borne solely by people, ultimately. And it was directed to the VoGo’s post about taxes and corporate welfare.

            Companies only organize labor and materials; merely serving as conduits. They don’t generate either of them. What they can do is create value.

            A car is worth more than bauxite, crude oil, rubber tree sap and time.

            There is only one thing that people can trade for goods and services; their labor. The money (or barter) they use is just a representation of that labor. People don’t have raw materials, unless they invest their labor acquiring them.

            Corporate taxes lessen the overall value created by the corporation, and the shareholders’ pay it.

            If those taxes are passed along to the consumer as higher prices (to avoid the shareholders’ loss), the consumer pays.

            If neither the consumer or the shareholder pay, then the loss in value is borne by the employee whose livelihood depends on the corporation.

            Now taxes don’t necessarily remove money from an economy, they redistribute it to government projects (often toward things that wouldn’t ordinarily receive them). Problem is, very few create value. In that way, they destroy value that could/would have been created in more fruitful endeavor. However, I wholly agree the necessity of a certain level of taxation.

        • 0 avatar
          Xeranar

          The classic misdirection argument on taxes. The view predicates a simplistic understanding of the tax system to justify it being used in such a way. OR to put it simply: You’re either dumb or you think we are.

          The easiest way to adjust the corporate tax code is to increase the rate but give tax breaks in the form of pro-growth offers. By forcing the corporations to reinvest in R&D and increased wages and decreasing the possible share to the stockholders you can reinvigorate the American Economy while not damaging the real wages of workers or dramatically increasing the cost of living. In fact this has been the standard line of most economists who understand corporate taxation and aren’t in their pockets.

          I appreciate that you’re trying to do a Romney with “Corporations are People!” but so is Soylent Green and yet they’re both fictional.

          • 0 avatar
            Landcrusher

            IOW, corporations should be taxed on everything except what the powers at be think they should be doing. This is of course the kind of nonsense that squandered our leadership in the world.

            The whole point of capitalism is to let the money flow towards its most efficient use. Rapid improvement will come only when the corrections are kept to a minimum and used to keep the markets free rather than forcing them to give certain results for certain people. The combination of New York and Washington demanding their tolls on every transaction along with restrictions on how everything must be done is strangling this country. We were mostly genetically filtered not to do well under yokes.

          • 0 avatar
            RangerM

            X,

            I hear what you’re saying and recognize it as the “classic” ad hominem fallacy. You haven’t addressed how (or where) I’m incorrect at all.

            Instead choosing to go into some rant about Romney, Soylent Green, and whether or not I’m dumb or think you are. (Hint: I’m leaning toward the latter)

            If you think that corporate taxes aren’t ultimately paid by shareholders, employees or customers say why, and then follow it up with what you believe the source of all revenues is. Start with some original thinking and go from there. It might help if you understand the concept of “Fungible”.

          • 0 avatar
            Xeranar

            Ranger – You think because you can throw the term around it means something? I called it simplistic because it is, the whole argument that ‘consumers pay for all taxes’ is on its face true but only on its face. You mind as well say everybody breathes air.

            The point is, corporate taxes represent a progressive tax system that benefits lower and middle class citizens before it benefits capitalists. In fact the whole idea of your argument is that if I raise corporate taxes to 90% then we’ll see a linear increase in pricing to supposedly off-set these profit margins. The reality is though is that we’ll see more forced R&D and wage increases because Corporation X will have to invest that money back into their corporation OR pay it to the government. The fact that the shareholders would get less return is irrelevant to the function of our society. We already have volumes of evidence to support the fact that the capitalist/investor class is not adding to the GDP of our country OR innovation in general. Instead they have shifted their resources to the most lucrative sectors which currently are financial systems.

            At it’s core the historical actions of the United States when the corporate rate was substantially higher meant less strain on individual citizens while corporations still made record profits. There is no historical or factual support for your economic theory or for your corporate tax rate reduction. Our system has had the burden be shifted to individuals already, so even if your argument were true (which it isn’t) it would mean nothing except perhaps putting in a more progressive system as the those most able to afford it would give more to the system.

            BOOM. Ad hominem, free, my friend. By the way, Romney was still ignorant to the idea that ‘corporations’ are people since when they commit crimes they don’t go to jail.

          • 0 avatar
            RangerM

            X,

            “The fact that the shareholders would get less ”

            Thanks for agreeing with me and proving my point.

          • 0 avatar
            Xeranar

            Truism aren’t much of a leg to stand on, Ranger. I wouldn’t get yourself too excited since my actual argument proved that shareholders are by default, irrelevant to the success of a company and to the economy. Though I understand you need a witty retort to come back from having your view demolished.

          • 0 avatar
            Landcrusher

            Xer,
            You started off okay, but then made a few unsupported leaps. The reality is that it’s even more complex than your argument, and your perception of how corporations will react is really just opinion and ideology.

            And, The corporations are people thing is just like the corporations don’t pay taxes thing. It’s true if you understand what it means. You can of course point out the flaws, but the problems start when you get too far from those sorts of principles. The way to screw things up is to take a principle, tag it’s shortcomings, feel brilliant, ignore the principle, and think your way into ruin. So many liberal/progressive/socialist ideas are flawed because they are based on the idea that things which are usually true are false because there are exceptions to them.

            Corporations will not necessarily spend more on R&D just because it’s exempted from taxes, but most of them will certainly claim they did on their taxes. Better to let the folks who make the money decide how it gets spent unless you work for an institution that benefits from more R&D spending… HEY! That describes YOU! :)

          • 0 avatar
            Landcrusher

            Xer,
            You snuck in another response on me. Shareholders do make a difference you are making my point as well. Just because they don’t have the effect they should, doesn’t mean they make no difference.

          • 0 avatar
            RangerM

            “Truism aren’t much of a leg to stand on, Ranger. I wouldn’t get yourself too excited since my actual argument proved that shareholders are by default, irrelevant to the success of a company and to the economy”

            But you haven’t grasped that I haven’t argued the benefits or detriments of one economic system over another. I have only stated that all taxes are borne by people. You have agreed with that, unless you’re saying that shareholders aren’t people.

            I’ll go further. No matter what economic system you can name, the taxes are still borne by people.

            You deserve credit for living up to Bastiat’s definition of government: “Government is the great fiction through which everybody endeavors to live at the expense of everybody else.”

          • 0 avatar
            Xeranar

            LC – I’m just going to keep it short, unless I misunderstood your argument, you made the classic right-wing argument that the system will be cheated because that’s how everybody acts which is an obtuse and completely false accusation to make.

            You mind as well say that we shouldn’t have laws because people break them.

            As for what I could write treatise on is that the corporate tax rate only applies to after-cost profits. It doesn’t count wages, materials, and services. In the end that money is called ‘profit’ for a reason, the point of the extremely high corporate tax was to force those corporations to either expand, raise wages, or invest in R&D, there are scores of deduction rules that can be written that can promote this reinvestment in the system that then adds to the GDP & coffers of the system. As it stands now the profit given to the capitalist/investor class is both under-taxed because of the ‘capital gains’ laws and represents capital that is usually reinvested and through the series of laws that basically allow them to escape most taxation.

            Suffice to say, LC you have a textbook understanding of Capitalism which has little real-world value and Ranger’s remarks are intentional obfuscating the point but I don’t expect agreement in this forum, I understand my position and I teach it to students and in fact crazy as it sounds I’m in the majority of economists.

          • 0 avatar
            Landcrusher

            I didn’t make the classic argument, and its not one particular to the right wing. I did make a classic left wing ad hominem attack, but I see you chose to ignore it. LOL.

            Taxing profits is especially nonsensical because it is really not enforceable in any fair manner, and all you need to know about the truth of that is the size of the code and that the IRS itself will not give a straight answer on most of it. Its a boon to those in power because they get to define, and change yearly, what is considered “profit”. People end up dying over some of those changes, but hey, fiddle away Washington.

            And, puhlease. Let’s not go back to where we each learned about capitalism, Professor. How many companies have you run, owned, worked for? How many millions of dollars have you shaken hands over? How many projects that created real, lasting jobs did you help create?

            We talk on this site mostly about how we want things to be, and how we perceive them to be. Your view is slanted by the constant exposure to stories of big companies and big labor and the really, really small people who are the antagonists. My view is a bit less jaded because I mostly got to avoid a lot of that while working with mostly professional people in the middle or at least on top of smaller companies who generally avoided using lawyers and interfacing with government. Of course, there was the one total sociopath…

            At any rate, we have had that discussion before. I will happily defer to your knowledge of arcane and useless regulations, labor laws, and abuses, because I want nothing to do with any of it other than to say it all ought to the way of the buggy whip labor unions. You might want to pay attention to my knowledge of incentives, and what sort of rules will get followed and won’t.

          • 0 avatar
            Xeranar

            That’s the retort isn’t it, LC? Business people feel their culture is being threatened when you tell them their farm is only soil and product. If we only let people who ran companies make policy decisions on business we would be in far worse shape than we are now. Everybody has a place where they come from, mine is history and macroeconomics. Your’s is entrepreneurial. When I want to start a new business I’ll call you up, when I want to know what kind of policies to enact on a macroeconomic scale through government action I’ll rely on myself.

            It doesn’t mean your expertise is worthless, it means that your position is less relevant to my own goals and ideas. If you think all my ideas are hammers looking for nails, that’s your perception, I think you’re goal is formed by the self-interested greed of corporate society that dictates the will is not to do good but merely to engage in profit making activities, perhaps we’re both coming at it from a different direction but at the end of the day I’m not going to accept your parameters because my own foundations point to them as either false or unworthy of consideration.

            But that’s what happens when people disagree in a democracy, I can’t make you agree with me nor can you force me to agree with you, instead we trade ideas and propose policies. In the end, it comes down to who can sway the ideological positions of the citizenry.

            In that respect, I hope I can win. But it has been interesting to discuss it, this place is the best insight into the right-wing mindset that doesn’t involve complete rhetoric. Best to know your opponents. Least we can disagree without coming to blows, LC.

          • 0 avatar
            Landcrusher

            You ran off in a weird direction. As we’ve discussed, I have studied macroeconomics and comparative economics at the graduate level (one class, but there it is). That’s not what’s really being argued here. Furthermore, I am not pushing for corporations to be self regulating or to have too much input on how they are regulated. Don’t know where you got that.

            The problem with taxing profits has less to do with macroeconomics, and everything to do with principle and microeconomics. The principle is that taxing profits is inefficient (compliance and enforcement costs are high), backwards (taxes suppress whatever is taxed), and gives too much power to government.

            We can agree the Internet is a great place to hash these things out.

        • 0 avatar
          Roland

          What Ranger M is arguing applies in a perfectly efficient market. Most markets aren’t efficient, and most taxes are a bit “sticky,” i.e. they can’t be necessarily get passed on.

          For instance, with this fuel tax, I don’t think there will be millions of American drivers suddenly striking for the wage increases to compensate for their added costs. Most American drivers will simply have to eat the pain.

          Likewise, with corporate taxes it all depends on a product’s pricing power. If a corporation doesn’t have the pricing power, it might not be able to pass along the whole cost. The owners of the corporation might very well end up having to eat some tax.

          All taxation is about sorting costs among people. Actually, most of what happens in every marketplace is about redistribution of some sort or another.

          The good news is that in overall terms, corporate profits have been unusually high in recent years. That makes the corporations worthwhile targets for certain types of taxation by revenue-hungry governments. I wouldn’t expect this profit trend to continue indefinitely, but in a downturn phase of corporate profits, the tax rates could always be lowered again. But under current conditions, high corporate income taxes would actually make a lot of sense.

          • 0 avatar
            RangerM

            “What Ranger M is arguing applies in a perfectly efficient market. Most markets aren’t efficient, and most taxes are a bit “sticky,” i.e. they can’t be necessarily get passed on.”

            I’ve never said they will always get passed on. I’ve said…..
            ……only people pay taxes.

            The corporation may write the check, but the proceeds didn’t originate with the corporation. They came from the sum total of revenues from customers. If there isn’t enough of that (or as you say–it doesn’t get passed on), then it comes from shareholders’ equity. If there isn’t enough of either, then it comes at the expense of the employees.

            In all cases, the check to pay the taxes will be covered by people.

            X,

            Thank you for providing me job security.

          • 0 avatar
            shaker

            Taxes are “sticky”, and there is an ongoing meme that taxes that are put into law are difficult to repeal; thus the desire to have lobbyists and lawyers at the corporate level paid very highly to fight any such taxes.
            The problem is that the roads, bridges, etc. are deteriorating at a rapid pace, and some argument could be made that corporations benefit greatly (especially oil and gas companies recently, whose fracking operations are pounding roads into dust), yet the only solution that comes to the fore is increasing the gas tax. While this is better than adding toll roads (which, in my opinion, are wasteful of fuel, add little value), a fuel tax is inherently regressive, punishing low-wage workers more because it makes driving (which is a necessity these days to maintain employment) more expensive. The answer has to be somewhere in between; the infrastructure benefits us all, but monetary support for said infrastructure is strangled by convoluted tax laws that obfuscate all of the beneficiaries that should share responsibility.

    • 0 avatar
      schmitt trigger

      Governmentspeak at its worst or most creative, depending on which side of the aisle on is standing.

    • 0 avatar
      Landcrusher

      No, it doesn’t.

      Maybe we could get a compromise? Secure the border, THEN offer some sort of amnesty. Fix the tax code, THEN offer tax amnesty.

      Of course, those ideas would mean doing some work which our Congress doesn’t seem to be able to do very well if at all. And, it’s not really partisanship either, it’s become systemic.

      We are going to need a plan to fix gerrymandering, and THEN raise the number of seats so the legislature has a realistic chance to monitor the executive…oh well.

    • 0 avatar
      TW5

      The US is one of the few countries that tries to hammer corporations for repatriating profits, and we’re losing dozens of corporations every month, as they change their tax residency to foreign countries that don’t tax repatriation.

      How f**ked up is that? If you want to invest in the US, you have to move your tax residency abroad so the feds don’t tax you for repatriating profits. The investment problem is just one of many problems caused for middle class America by over-taxing US corporations.

      Regurgitating talking points is the quickest way to render yourself irrelevant.

      • 0 avatar
        Xeranar

        Except your argument ignores what can easily be changed by law by simply taxing any profits made here in the US and frankly the ‘talking points’ argument is pointed right back at you by claiming we’re hemorrhaging S&P500s all over the place.

        • 0 avatar
          Landcrusher

          Did I miss something? Where did TW5 mention the S&P 500? I suspect his “dozens” is a ridiculously low estimate.

          Flag on the play, Xeranar!

          Plus, your proposed law change is really unclear. Are you proposing to stop taxing overseas profits?

          • 0 avatar
            Xeranar

            LC – It was a point of reference, especially considering the corporations that can have sizable overseas ventures are most likely the S&P1000 or just off that.

            As it stands the United States does not tax profits held overseas, if you make the money in Germany and keep it there we have no interest in it. This is what actually drives the premise that by sheltering profits overseas and only repatriating them through pricing schemes (i.e. buying products in these foreign countries then bringing them in to resell or use but creating a straw purchaser to sell it back to you) is hurting the US. We could choose to tax profits held by non-US companies and to a certain extent we do, but those laws are actually independent of each other.

            The ideal case is Starbucks and Microsoft who setup in the Ireland tax haven to hide profits from other EU countries. By changing the laws domestically it would force these tax havens to shut down by simply disallowing their actions. As the United States we have enough economic clout to throw a wrench into the system if we choose to.

          • 0 avatar
            Landcrusher

            It still was a bad play, and there are still ways of moving domestic profits as well. No tax system is perfect, but taxing profits is just asking for trouble.

          • 0 avatar
            TW5

            @ Xeranar

            A country trying to eliminate the negative consequences of its own bad policy with new bad policy is like a junkie taking a hit of smack to cure the shakes. The repatriation problem was created by poor policy that gave corporations incentives to offshore income producing assets and jobs in some cases. The repatriation problem has become so acute that American companies would rather leave than pay taxes to repatriate foreign profits into the US for investment.

            If the US will simply align its tax policy with the rest of the developed world, the problem will fix itself, without having to usurp the financial sovereignty of other nations.

          • 0 avatar
            Xeranar

            LC – What are we going to tax? The air? willpower? Everything we tax is a ‘profit’ this is why we allow for tax deductions from our personal income taxes. I understand you disagree, but there is little to support that approach except ideology.

            TW5 – Please, I listened to your remarks and they amount to hyperbole mixed with a neo-liberal economic theory. The voodoo economics have failed, sir, you aren’t going to be able to make pointless analogies for much longer as more countries are looking at this repatriation issue with a seriousness that can bring about change sooner rather than later.

          • 0 avatar
            Landcrusher

            Xer, everything is not a profit. We tax labor and profits with the income tax, wealth with property taxes, and consumption with sales taxes and various fees. Not sure where the scholars would come down on a VAT tax, but the consumer eventually pays most of that, so it’s really a hidden sales tax.

            I don’t have an issue with taxing passive income (profits), but it needs to be much simpler than it is today. It’s best to tax it at a flat rate (not for fairness, but for transparency).

            Taxing corporate profits is taxing labor and profit actually. You cannot do it simply and well, so just don’t do it. Besides, taxing labor is going to become silly regressive very soon. The robots are coming.

  • avatar
    RangerM

    All corporate taxes are ultimately paid by individuals, anyway.

    When a corporation pays taxes, it is financed by its customers (through higher prices), its employees (through reductions in wages/benefits), or its shareholders (through reductions in dividends/shareholder equity).

    • 0 avatar
      thornmark

      In my state a few years ago the majority party raised the tax on the wholesale price of gas – so people wouldn’t see the increase listed at the pump – and forbade the oil companies from passing the tax along.

      Experts said that was illegal, not to allow cos. to pass on the tax. But the majority party said the experts were wrong and if the courts stuck down the provision against passing the tax on to the consumer, then they would rescind the tax.

      The courts took little time in striking down that no-pass-along provision and the majority party not only did not rescind the tax increase, they actually imposed a further increase a few months ago.

      The same party wants to reintroduce tolls on state highways despite the fact that their removal has prevented the many deaths that used to occur at or near the toll plazas.

      Oh, and there’s little concrete evidence that the roads have benefitted in any way from the tax increases.

      • 0 avatar
        dwford

        That wholesale price gas tax is very sneaky. In CT it is a % of the price of gas, so as the wholesale price goes up, the retail price goes up even faster as the gas tax rises. And everyone wonders why CT has such high gas prices. Not that it’s enough, since we always run a deficit and our roads are crap.

      • 0 avatar
        VoGo

        “there’s little concrete evidence that the roads have benefited in any way from the tax increases.”

        Any asphalt evidence?

        • 0 avatar
          ttacgreg

          I don’t know let’s cut gas taxes let’s cut the money available to build and maintain roads and find out. What say you?

          Or I suppose we could just set up multiple tollbooths everywhere across the country. I’d rather just pay at the pump rather than at toll booths but since taxes have been effectively vilified over the past few decades, by anti government interests, what’s one to do?

          • 0 avatar
            Andrew717

            “but since taxes have been effectively vilified over the past few decades, by anti government interests, what’s one to do?”

            but since taxes have been effectively vilified over the past few millenia, by taxpayers, what’s one to do?

            Fixed it for ya.

          • 0 avatar
            Xeranar

            Andrew – Historically taxes have been paid with a gripe but recognized as a required necessity of existence. Only in the latter half of the 20th century have they become some sort of poison for the population to swallow but that has more to do with the tax burden being shifted from corporations to individuals.

            Not that perception on this issue is even close to accurate.

          • 0 avatar
            danio3834

            People begin to resent taxation more often when policy moves from taxation to provide benefits they can see, to toward redistribution that they might never see.

  • avatar
    frozenman

    Federal taxes on gasoline in Canada currently run 40 cents per US gallon with Alberta provincial road tax of 36 cents per US gallon, plus an overall federal GST(goods an services tax) of 5% on the total. With a refiner price of of 3.84 CDN per US gallon we pay: (3.84+.40+.36)1.05= $4.83 CDN per US gallon currently in Alberta (pretty much the lowest in the country. The US has a ways to go to catch up!

    • 0 avatar
      Onus

      I’ll have an example of what we have here in Connecticut ( some of the higher fuel taxes in the country )

      18.4 cents federal and 67.7 cents for state fuel tax.

      For diesel its 24.4 cents for federal and 79.3 cents for state.

      I think most of your problem is the base fuel price due to distance from the refineries. I can put fuel for 3.84 a gallon with the taxes or did until this Iraq mess.

      • 0 avatar
        frozenman

        Onus, the worst part is the 5% GST on the final tally at the pump. Paying taxes on top of taxes is galling. That being said, if the US had a federal sales tax ( the only developed country that doesn’t) you would have enough cash to balance the books federally. Yes taxes are a problem but up here we don’t seem to be lurching from one financial crisis to another and our housing prices remain reasonably stable.

        • 0 avatar
          danio3834

          You’re probably right, but good luck on them getting a consumption tax passed that would evenly affect everyone. Or as they would say, hurts the poor.

        • 0 avatar
          Onus

          Yup can’t go wrong with that.

          Consumption tax is something we need and I’m all for.

          Having the tax included in the price would also make shopping a heck of a lot easier.

      • 0 avatar
        thornmark

        CT raised the tax on the wholesale price of gas. Again. See comment above.

    • 0 avatar
      ttacgreg

      And in my limited experience in Alberta, the roads there are clearly superior to those I drive on here in Colorado in presumably similar brutal (to pavement) long winter freeze thaw cycles.

      Gas taxes encourage conservation, and make for quality roads. Win/win by my thinking.

  • avatar
    28-Cars-Later

    Can’t cut the fat of course. They are all about demand destruction eh?

  • avatar
    vent-L-8

    This should kick in right about the time that “Iraqi instability” drives the price up as well.

  • avatar
    Scott_314

    Federal gas taxes have been effectively decreasing for two decades, and with overall gasoline use flattening, less and less revenues are coming in to maintain and expand the highway network.

    So an increase is long overdue and shouldn’t upset people too much.

  • avatar
    cartunez

    I suppose this time we can trust them to use the money wisely and for its intended purpose. Meanwhile I will be riding a Pegasus to work to avoid the tax.

  • avatar
    wmba

    I assume English is not the poster’s first language because the headline makes NO sense, as the first commenter noted.

    C’mon TTAC, get a move on changing it to something readable. It’s not the first time for this sort of error in recent times.

  • avatar
    Lou_BC

    The next president of the USA said “her country and Canada need to seize the moment to become global leaders in cleaner energy.”

    If that is the case then a gas tax will become a consumptive tax levied against fossil fuels and will amount to one more subsidy for the alternative fuel industry.

    http://www.theglobeandmail.com/news/national/hillary-clinton-tells-edmonton-audience-north-america-can-lead-on-clean-energy/article19233941/

    • 0 avatar
      VoGo

      I am happy to pay higher gas taxes to fund research into the technologies of the future. Just so long as we can also reduce income taxes, much of which are used to fund wars to protect the oil rich gulf.

  • avatar
    RogerB34

    How much of the gasoline tax is spent on subways, light rail, bike paths and trails?
    The pitch is highway and bridge construction and maintenance but the substantial amount spent on non highway projects is not disclosed.
    Classified “not for public need to know”.

    • 0 avatar
      Pch101

      “The pitch is highway and bridge construction and maintenance but the substantial amount spent on non highway projects is not disclosed.”

      Just because you’re too lazy to look it up doesn’t mean that it isn’t disclosed.

      Spending is a matter of public record. If you are really interested, then go look it up.

      While you’re at it, then you could also research all of the other funds that are diverted from other sources into building and maintaining roads. Gas taxes aren’t high enough to cover the costs.

      • 0 avatar
        Hillman

        +1 Pch101. Amazing how much info you can find that the local governments are willing to give out due to FOIA. Shame most people are only interested in talking points that are not even related to their state.

  • avatar
    ceipower

    A tax increase on gasoline?? Long, Long, Long overdue!! There’s No Way to justify not increasing the tax. Still politicians , being influenced by the the uber rich want to tilt things to their advantage. Disgusting. Just raise the tax across the board equally per gallon and get on to more important stuff

  • avatar
    hiptech

    Overlooked was the good news… all bridges, primary, secondary roads and highways across the country will immediately undergo improvements and resurfacing bringing them up to the equal levels as the Autobahn.

    Included in the program will be covered parking in all public and private lots that will utilize solar electric technology to provide free recharging to all electric vehicles and reduce costs to all businesses which in turn will reduce their pricing accordingly…

    America will now become a beacon for all industrialized countries to look at with awe, wonder and envy. All speed limits will be increased appropriately and law enforcement will strictly enforce driver courtesy especially cracking down on drivers failing to yield to the flow of traffic and those impeding it by driving in the left lanes at slower speeds…

    Hey, is this a great country or what?

  • avatar
    TW5

    Congress is so impotent, they can barely continue bad status quo policy. I will be surprised if this gets through the Senate and House without a major meltdown.

    • 0 avatar
      ClutchCarGo

      While this could just possibly make it thru the Senate, it’s hard to see how this could ever make it thru the House given the fear of a Tea Party primary challenge.

  • avatar
    Dr. Kenneth Noisewater

    Get rid of CAFE and fixed federal gas tax, then introduce a replacement for both:

    * Pick a base year, get its average fuel economy for all vehicles and average price of wholesale fuel. Say, $2.50/gal and 25mpg. That gets you 10 cents per mile on average.
    * Without restricting what automakers may build or people may choose to buy, adjust taxation on gas such that running at the higher mileage ends up costing you the constant 10 cents/mile. So, if the standard rises to 30mpg, charge 50c/gal (($0.10 * new mpg requirement) – base year gas price of $2.50). Increase the efficiency requirement gradually over time.

    I would chalk that tax up as an offset for all of the subsidies given to the global oil-industrial complex (such as CENTCOM, corporate welfare, etc), and split highway maintenance out into per-vehicle-mile fee that is assessed at registration.

    • 0 avatar
      Xeranar

      First off your argument doesn’t account for inflation which every 20 years would have to double the base mileage, second of all it would simply cause stagnation without instituting a different form of CAFE without raising the efficiency requirement.

      CAFE is the boogieman of the auto industry. Nobody wants to admit they can hit it with ease but at the cost of a slight margin of profit or slightly raised prices. But if you admit you can do it easily the next time in their minds the demands will be greater. The argument is more psychology than petrol technology.

  • avatar
    Lynn E.

    “If that is the case then a gas tax will become a consumptive tax levied against fossil fuels and will amount to one more subsidy for the alternative fuel industry.”

    I sure hope so.

    We have had fun burning oil in vehicles making noise and dirt for about 150 years but the world’s population is way too large to continue this “fun”. Now is the time to try some new ideas.

  • avatar
    honda_lawn_art

    Corporate offshore profit tax repatriation holiday. The hell is that?

  • avatar
    redav

    So long as I can be assured that the funds will definitely lead to better roads, I am in favor.

    I would reject it if the extra taxes just go toward pork projects, inefficient construction (waste), or funneled off to other accounts, etc.

    • 0 avatar
      jacob_coulter

      Rest assured, it will be used to fund all sorts of ridiculous pork barrel projects.

      I agree with your sentiment though, I’d much rather see my tax dollars go to real infrastructure than more entitlements. If they can offset the tax increase by cutting somewhere else, I can support it.

  • avatar
    Lou_BC

    @Lynn E.- looks like “BigTrucksSeriesReview is getting a bit slack. He hasn’t buried you under a ton of right wing flotsam and jetsam.

    • 0 avatar
      Big Al from Oz

      Conservatives that move further to the right are probably more socialist than you think.

      Just take the situation of the high fuel usage light commercials in the US (V8 pickups). Many of these ‘right wing’ conservative fight tooth and nail that it is their right to have unlimited cheap fuel.

      Then they support policy to protect the vehicles that support their paradigm of ‘Big Ass’ vehicles. Socialism???? or not.

      A true conservative and believer in freedom will support policy where the best may win. In other words economic freedom.

      It’s odd that most of the freest countries in the world economically are also considered socialist by the people of Central Mexico (Murica).

      • 0 avatar
        Xeranar

        Big Al, you just used a No True Scotsman argument & your right-wing socialism is called corporatism. Socialism benefits the widest base of people at the cost of the most wealthy. Corporatism works in reverse in a practical sense, though it doesn’t necessarily require the poor and middle class to support the rich the practical reality is such.

        Whatever ‘conservatives’ want to believe or do their actions are firmly entrenched with benefiting the wealthy based on their flawed social perceptions of ‘wealth = moral good’ and how these interactions have been calcified into ideological bullet points that cannot be shifted. Taxes has become the biggest point on that chart and tragically pre-New Deal conservatives were far less anti-tax and over the ensuing generations with the dramatically increased role of corporations within the Republican Party along with a melding of the Southern economic theory has created a laissez faire faction that wants to ignore what every other western country does.

        Our Right can’t even compare to your Right in OZ. On the worst of days your political right is about center or blue dog democrat to our system.

        • 0 avatar
          Big Al from Oz

          @Xeranar
          My comment was a ‘tongue in cheek’ response to Lou’s take on BTR.

          I’m actually not as right wing as you would assume.

          As for making a comparison between countries. It’s not ‘our’ right that is any different.

          It’s the people of Australia, the consumer.

          We make or break government.

          It seems many in the US have this sense of entitlement we don’t have to the same extent.

          While the left and right in the US exhibit this sense of entitlement and both think they are correct. The US will remain quite polarised politically.

          These car blog site like TTAC really highlight the false sense of where people sit politically, ie, BigTrucksReview is a classic example of a Redneck Socialist.

          He want everyone to pay his way in life so he doesn’t have to expend much effort.

          • 0 avatar
            Landcrusher

            You guys should stick to saying what you want rather than trying to scry the motivations of the other side.

            People who want cheap fuel are just being rational. People who think cheap energy is good for the economy are just being rational. And, even people concerned with pollution are being rational.

            People who want to control how everybody else lives and play games with the outcomes need to get over themselves, but I don’t pretend to know your motivations. Assuming ill will and caricaturing the other side isn’t getting anyone anywhere. Besides that, you are drawing a caricature of the people the Tea Party, who you seem to really hate, are trying to displace from power.

          • 0 avatar
            Big Al from Oz

            @Landcrusher
            My view is to have realistic and equitable policy and regulation.

            This covers every aspect of life.

            It should be the consumer who decides what is of most value, hence my view on restrictive trade policy.

            The price of fuel and just stating we want the cheapest should also transfer over into all aspects of your paradigms.

            But you like many on this site make statements of entitlement like this with little thought into how and where the big bad world works.

            All I read are people who whine and cry over taxation levels, but yet don’t sit and look at the waste in the US.

            Yet these same people whine and cry that they pay taxes and don’t receive enough handouts.

            Corporate/industrial support in the US cost over 2.4 trillion dollars a year.

            Is the consumer benefiting from this expense?

            Maybe if everyone looks at what they can do to improve their lives instead of expecting others to pick up the costs, then we in the West would be more competitive.

            It’s simple if it isn’t viable don’t do it. Don’t expect the consumer to subsidise your EVs, cheap fuel, etc. It’s of little overall value and benefit for society.

          • 0 avatar
            Landcrusher

            Al,
            Realistic and equitable is likely to describe everyone’s goals in their own minds. When you say that, what you are really saying is that those who disagree with you don’t want that. Which is BS.

            I don’t know your view on restrictive trade policies so ?????

            The price of fuel is the price. It’s the taxes we are talking about here. While you are reading the minds of your antagonists, tell me my view on the taxes.

            Entitlement? Please give quote and reason for why it represents a feeling of entitlement. I call BS.

            You just love to throw out made up numbers, so I am going to just call BS on any of your numbers from now on. Just because you read it, doesn’t make it so. I am against subsidies. A subsidy being a payment, not a made up number from some propaganda outfit.

            Finally, I am insulted, and mystified, that you think I want other consumers to subsidize anything for me.

        • 0 avatar
          Lou_BC

          @Xeranar – when I look at American politics and Canadian politics our federal right would often be viewed as centrist or slightly right of centre by many USA conservatives. Some would even say they were more left of centre.
          Our conservative Federal government has tried to shift our politics more to the right but I suspect that will be the cause of their own downfall.
          In BC where I live we have a Liberal government that is slightly to the right and they are opposed by a far left political party.

          • 0 avatar
            Roland

            Lou, is the NDP suggesting common ownership of the means of production? Are they in favour of nationalizing industries and distributing the property?

            The NDP is not a “left” party, even if you apply the term very loosely. It’s an eye-opener to compare old CCF platforms to today’s watered-down NDP. And to think the CCF used to get over 25% of the vote in BC, when running on an openly proclaimed socialist programme.

            Like in most Western countries since the end of the Cold War, Canada’s political spectrum has shifted substantially to the right. If people like Diefenbaker or W.A.C. Bennett appeared on the scene today, they’d both be denounced as Communists.

            There is currently no actual left wing party on the Canadian political scene, except maybe for the “Solidaire” which won a couple of seats in the Quebec provincial election this spring.

  • avatar
    Jeff S

    I am in favor of raising the fuel tax only if the increase goes directly for building and repairing of roads and bridges and nothing else–not alternate energy, not trail or bike paths, and not mass transit. There are bridges such as the Brent Spence bridge over the Ohio River that is over 50 years old and that needs to be replaced. They want to make the replacement bridge a toll road but it is a major bridge for I-71 and I-75. We should not just hand Congress an additional pot of money to waste when the roads and bridges are falling apart. We need to rebuild roads and bridges as well as other critical infrastructure.

    • 0 avatar
      Big Al from Oz

      @Jeff S,
      I do believe in a user pays system by government.

      But, there are some aspects of community that must be socialised, ie, education, health, defence, etc.

      The government is the best conduit to collect the money and distribute the money for transport infrastructure.

  • avatar
    Big Al from Oz

    It was inevitable that the US would increase it’s tax on fuel and will continue to do so.

    To prevent a loss of revenue the fuel tax should be indexed to the CPI.

    The only problem with the fuel tax is the already heavily socialised green vehicles require a way to be taxed.

  • avatar
    SCE to AUX

    I drive a Leaf, so go ahead and raise the gas tax all you want.

    But I also have a new Optima Hybrid and a Sedona minivan. My household CAFE has doubled in two years’ time, but my vehicles are just as tough on the roads.

    What I’ve described above is true, but it represents the problem with raising the gas tax – it is inevitably unfair, and our rising national CAFE standards are undermining the road tax system.

    Road taxes should be: Tax = annual miles driven X GVWR. Simple.

  • avatar
    Z71_Silvy

    And 100% of this increase will go for anything other than roads.

    This is yet another money grab by our elected thieves. They steal enough from me already and waste it, why should I give them more?

    Start licensing bike riders and require them to pay yearly registration fees

  • avatar
    Roland

    Consumption taxes tend to be regressive (i.e. impose a heavier relative obligation on poorer taxpayers) unless there are offsets elsewhere in the tax system.

    People who must rely on automobile transport to get to work, or who need automobiles because of the low-density housing development pattern typical of many parts of the USA, won’t necessarily be able to reduce their mileage driven in response to a tax. They’re just gonna get nailed.

    I guess from a lazy politican’s standpoint, those people are easy targets to hit when you want money.

  • avatar
    3Deuce27

    The raise in fuel taxes is long overdue, and it will mostly be absorbed by the suppliers, as a significant rise in fuel costs in today’s economy will cool sales.

    We have seen the per gallon price of fuel rise significantly with no proportioned rise in road taxes at the federal and state levels, all the while our expensive infrastructure degrades to unsafe at any speed levels.

    The small increase proposed, is not near enough.

    • 0 avatar
      Lorenzo

      Horse puckey. Nobody in the supply chain absorbs any additional costs, they just pass it on, sometimes with a little extra tacked on. Every cent of the increase plus a few cents more will show up at the pump. As the Transportation Secretary told Congress in 2006, 30% goes to roads and bridges, the rest goes to “special projects”.

      The backlog of deferred maintenance and replacement is so large, no gas tax increase will be enough. There’s a crisis deadline coming up and this is just another band aid covering a gaping wound, aka, kicking the can down the road. Pay more and expect nothing in return.

  • avatar
    Jeff S

    @Roland–The original purpose of the fuel tax was to fund the building and maintenance of roads and bridges. Whether this is unfair to the lower income or not that was the original purpose. It is not fair to tax someone who does not use the roads. The excise tax on tires and heavy trucks also funds roads and bridges. If we start exempting users from the fuel tax because of their income then this will defeat the purpose of the tax and there will be even less revenue for roads and bridges. There are exemptions for farmers who use fuel for off road purposes and for reefer units on large trucks. It is one thing to exempt people below a certain income from income tax but this should not apply to a user tax for a specific purpose.
    @Big Al–I don’t disagree with you about education.

  • avatar
    Lynn E.

    “People who must rely on automobile transport to get to work, or who need automobiles because of the low-density housing development pattern typical of many parts of the USA, won’t necessarily be able to reduce their mileage driven in response to a tax. They’re just gonna get nailed.

    I guess from a lazy politician’s standpoint, those people are easy targets to hit when you want money.”

    Oh boy, another obvious comment about saving the poor and dumb. We make choices. Some decided to move far from work, ask for wide roads, and clutter our land with parking lots. Some moved to where they could walk to work. Now the poor and dumb are being asked to “save” themselves by paying higher taxes to maintain their roads, parking lots, and clean the air. Tough.

    • 0 avatar
      DenverMike

      “Some moved to where they could walk to work. Now the poor and dumb are being asked to “save” themselves by paying higher taxes to maintain their roads, parking lots, and clean the air. Tough.”

      There’s not much to think about when the choices are, live in an urban ghetto near where the jobs are, or a rural spot with wide open spaces, where you can actually see the stars at night, that’s also safe, affordable and away from too many humans stacked/crammed together in a small area.

      Point is, America was built on the promise of cheap gasoline. Urban sprawl and whatnot. Mistake or not, we can undo this overnight.

  • avatar
    Jeff S

    @Denver Mike–This is one time I agree with you. I think you meant we cannot undo the promise of cheap gas and the ability it gives us to live in more desirable area away from the problems of the inner city. Anyway the purpose of Federal Excise Taxes on fuel, tires, and heavy trucks is to pay the the roads and bridges. It would be hard to pay for these with an income tax or to exempt certain groups from this tax based on income.


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