The time has come. Reform is moving — with strong initial steps that need to be strengthened even further in conference committee. Time to take a razor to waste. But without revenue to fix a transportation mess 20 years in the making, our goose is cooked. We overspent on the big dig, and neglected everything else. Time to invest in our future.
By raising the gas tax 2 cents a month, we can make the change at the pump gradual. By dedicating 5 cents on the tax to give to low and middle income people (by expanding the personal income tax exemption and increasing the earned income tax credit, for example), we can dramatically soften the income on low-income drivers. But we’re going to need at least the 19 cents the Governor calls for. I would support 30.
Let everyone pay for the needed revenue. Flat gas tax.
One very reasonable objection to the gas tax is that it might unduly affect the disabled who depend on vans and the like (billxi, we hear you). Additionally it also hits those who live away from cities more. I suspect we’d want to provide refunds or get-out-of-tax-free cards to some smallish segment of the population. Figuring that out might take some time.
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p>I’m not sure I understand the economics of such things too well. Isn’t it the case that a 10% tax has a tendency to total increase the price only 5% so that, in effect, consumer and producer are splitting the tax?
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p>The con part is, of course, that the state’s revenue stream desperately needs stabilization. Soon, quick, and immediate.
… that all of our short term solutions are regressive in nature. Ezra had a post pointing out that State and Local taxes tend to work against any gains in progressiveness from Federal taxes:
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The state legislature is too cowardly and too unwilling to take on the politics for raising the income tax. Making the income tax more progressive requires a constitutional amendment.
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p>The political obstacles are daunting, but otherwise I’d agree.
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p>(I did see the E.K.’s thousands of graphs, too, by the way. You’ve got me reading him more regularly.)
I wasn’t commenting that we should take a different, more progressive tack,… just that the options we do have suck with regard to progressivity.
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p>It is true that Ezra loves him some graphs and charts! đŸ˜‰