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Gasoline tax wrong place to start cutting
Comments 0 | Recommend 0While there is certainly a lot about taxation in America that is worth debating, it is ironic that all three current presidential hopefuls - John McCain, Hillary Clinton and Barack Obama - have chosen the federal gasoline tax for particular scrutiny.
Attention was drawn to the tax - which is 18.4 cents per gallon - when Arizona's Sen. McCain proposed the federal government suspend the tax between Memorial Day and Labor Day this year, the traditional summer vacation driving season.
McCain's thought was that consumers, whip-sawed by rising gas prices, would get a boost from this temporary reduction. This prompted Democratic presidential hopeful Sen. Clinton to join in, saying it was a good idea, although they have since disagreed on some of the details.
The lone holdout was Democratic hopeful Sen. Obama who called the gasoline tax break idea political pandering. He said the amount saved for the average driver during the summer would be about $30 and it would be better to leave the tax alone and to start talking about real and permanent solutions to high gas prices.
Any break from taxation is welcome, of course, so many Americans are probably supportive of the idea. The likelihood of it happening are not that great, given that it has no support from the White House and little in Congress.
If the candidates want to help people by reducing taxes - and that is a good idea - there are plenty of other better choices than the gasoline tax, which in terms of a tax is one of the more useful and easily understood ones. That is because it is actually a form of user tax which directly benefits those who pay it.
Federal gas tax revenues are used to maintain and build the federal highway system. Presumably those who buy gasoline are likely to make use of those roads - so by paying the tax they are helping to pay for something that benefits them.
That isn't true of most other taxes. The taxes are collected and put into a general pot to be ladled out as lawmakers choose, perhaps on things that do not benefit a particular taxpayer at all or with which that taxpayer may even strongly disagree.
One can always debate whether the federal gas tax is too high or too low, but at least you know what you are getting when you pay it.
Presidential candidates should be talking about cutting taxes because that truly would benefit consumers who are struggling to balance their budgets. But the idea that the federal gasoline tax is the place to start is ludicrous, particularly since it would only be temporary anyway.
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