Fuel tax not thought-about in Biden infrastructure plan, White Home says

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White House Press Secretary Jen Psaki speaks out during a press conference at the White House in Washington on February 8, 2021.

Carlos Barria | Reuters

According to the White House top spokeswoman, the Biden administration is not considering increasing federal gasoline taxes as a means to help pay for its landmark infrastructure proposal.

The gas tax issue was raised during the press conference by press secretary Jen Psaki on Tuesday afternoon when a reporter urged her to bring up reports on Monday that President Joe Biden may be open to raising the gas tax from the current 18.4 cents a gallon.

“At yesterday’s meeting with members of Congress, the president only mentioned the gas tax to indicate that even a significant increase in gas tax that some people have proposed would only pay for a fraction of the investment the country needs.” She said.

“Now he doesn’t really think that paying for this historic investment in rebuilding our country’s infrastructure and creating millions of jobs should be on the back of the Americans.”

When asked whether an increase in the gas tax is currently not being discussed, Psaki replied: “Right.”

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That the White House is not considering a gas tax hike is noteworthy given the early hurdles the government has faced in attempting to sell its plan to Capitol Hill.

Republicans and Democrats like the idea of ​​repairing the nation’s roads and bridges, expanding broadband access, and providing access to professional training. Given the $ 2 trillion price tag on the Biden plan, politicians on both parties are concerned about the size of the proposal and the payment options for another trillion dollar fiscal stimulus.

So far, the White House has put into action the idea of ​​raising the corporate tax rate from 21% to 28% and trying to prevent corporate profits from being offshored.

Biden, who met with a bipartisan group of lawmakers on Monday about the infrastructure plan, said he would face and hear criticism from Republicans who are skeptical of the American employment plan. Still, the president has warned that he is ready to move the plan forward without Republican votes as he sees the plan as critical to the recovery of the economy from the Covid-19 pandemic.

The gas tax concept is often criticized for having a disproportionate impact on rural and low-income communities. Nor would it be a viable long-term option for a government hoping to convince more Americans to swap their gas-powered cars for electric vehicles.

Aside from a gas tax, Biden could opt to investigate income taxes, a mileage tax, monetizing the power grid, or funding the plan by covering the interest costs associated with taxable municipal bonds.

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