President Donald J. Trump recently voiced his support for a 25-cent increase in the Federal gas tax as a way to fund repairs to aging American infrastructure. The proposal, which is also endorsed by the General Contractors Association of New York, could be a way to pay for fixing aging New York roads and bridges.
A Potential Solution to Fund New York Road Repair
“The invisible tax we pay in terms of wear and tear on our cars alone is far more expensive than the 25 cents that could put those roads and bridges back into good repair, to say nothing of easing our commute, improving our productivity, reducing gaswasting congestion, potentially saving lives – and overall, reducing the taxing cost of driving today,” the General Contractors Association of New York stated in its report.
25-Cent Tax Increase could be Phased in Over 5 Years
In January, the U.S. Chamber of Commerce first proposed the 25-cent tax hike, which would be the first increase in 25 years. The organization stated that it was the “simplest, fairest, and most efficient way to raise the money that America needs to fund critical upgrades to our roads, bridges, and transit systems.”
The plan calls for the new tax to be phased in over a five-year period in five-cent increments. Motorists’ gas bills would likely increase about $9 a month. The General Contractors Association of New York found that the tax hike would cost New York households $186.40 each year in additional taxes. Nationwide, as much as $394 billion could be raised.
The Gas Tax could Pay ‘Significant Dividend’
It is estimated that every state in the country now receives more Federal road funding than it sends back in taxes. The cumulative road repair deficit in the United States is projected to be several hundred billion dollars.
The General Contractors Association of New York noted that the amount motorists spend on vehicle repairs currently exceeds the cost of fixing New York roads. The organization estimated that operating and repairs cost drivers 226 percent more than what motorists would pay in the gas tax.
Poor Road Conditions Drain Resources
“As big as those number are, they don’t even factor in the economic impact of congestion caused by poor and mediocre road and bridge conditions — something that more than doubles the cost, adding $121 billion annually in terms of wasted time and increase fuel costs,” the General Contractors Association report stated. “The bottom line is that on average, a 25-cent increase in the gas tax would actually pay a significant dividend — an over 200 percent return — in terms of being far less taxing on households, vehicles and on road-borne commerce.”
Although a new gas tax has presidential support, it still has many hurdles to climb before it is law. In the meantime, New York roads and bridges will continue to feel the effects of aging.