Oil and the economy

Back on Page 4, Yankee Fan had post quoting a CNN story that said every cent decline in the price of gas puts roughly $1 billion back in the pockets of the American people. I assume this is on an annual basis. So let's translate that into gas taxes. The federal rate is 18 cents a gallon, while state rates vary. But let's just pick a rough average and for the sake of argument that the average between the 50 states is 25 cents. That means that $43 billion is being taken out of American families' pockets every year. And we want to raise that to $48 billion or more simply because the price of gas has come down? I'm sorry, but I think we need a better reason than "we can get away with this."

As Yankee also pointed out, right now federal and state taxes on gas are running at about 25%. The highest state sales tax in the US is Tennessee at 9.45%. That is just under 10%, which is ridiculously high.

 

Chicago's sales tax is 9.5%, down from 9.75%, because of a drop in the county's tax:

Now, if you're a downtown restaurant, your meals have an additional 1.25% tax. 0.25% goes to the city, and 1% goes to the Metropolitan Pier and Exposition Authority, which runs Navy Pier and McCormick Place.

 

Sure, cut the gas tax and increase the diesel tax.

It is the big trucks, the 18-wheelers that tear up the country's interstates and roads. My town has several freeway loops. One of which doesn't allow for 18-wheeler traffic. It still uses the original pavement from when it was built. The pavements for the other loops and interstates have been replaced have been replaced dozens of times.

Make the truckers pay their fair share and everything will be fine of course the truckers have lobbyists and increasing the diesel tax isn't going to happen.

 

Government gets you one way or another. If a state has a low sales tax (such as Wisconsin) then it has high state income tax rates and/or incredibly high property tax rates.

 

Gee, I wonder who really will end up paying.

 

LOL.

Yeah, let's increase the price of bringing goods to market.

 

Job creators!

Waitresses in Happy Valley!

Monorails! That's the ticket.

 

Gasoline and diesel federal/state/local taxes and fees (these are excise taxes, not broadly applicable sales taxes)

http://www.api.org/oil-and-natural-gas-overview/industry-economics/fuel-taxes

 

Tried to post the link to the image and it didn't work right. Anyway, this story ...

http://blogs.wsj.com/economics/2014/07/16/interactive-maps-comparing-road-bridge-quality-by-state/

... shows that some of the higher gas tax states (e.g., NY, CA) have the worst roads (as measured by proportion of roads rated in poor condition).

 

So, diesel is already taxed at $0.06 per gallon more than gasoline on a federal level, and some states also tax it at a higher rate -- Illinois taxes it an additional $0.015.

 

I think you may have a causation vs. correlation problem there.

 

Care to expand on that, cran? I'm not sure what you're getting at.