How Do Pa. Gas Taxes Stack Up?

JANUARY 17, 2013 | by NATHAN BENEFIELD

In the wake of reports Gov. Corbett will unveil a transportation funding plan that includes increasing the cap on the Oil Company Franchise Tax, the Tax Foundation has put out two new resources related to gas taxes and road funding.

In a new report, the Foundation finds the Pennsylvania ranks 18th highest in the nation with 33 percent of road costs paid for by fuel taxes or by user fees. The rest of funding comes from general tax sources, including local taxes, federal funds and (in Pennsylvania's case) the Oil Company Franchise Tax, as it doesn't function like a user fee.

The study suggests that road costs should come from user fees (including fuel taxes) so as to impose the costs on those who use the roads:

The people that use the roads benefit from them and should bear a sizeable portion of the cost. By contrast, funding transportation out of general revenue makes roads "free," and consequently, overused or congested—often the precise problem transportation spending programs are meant to solve.

In addition, the Tax Foundation's latest "Map of the Week" shows gasoline taxes by state. Pennsylvania already ranks as the 7th-highest taxed state, with state gasoline taxes coming to more than 39 cents per gallon.

For more on transportation funding and reform in the Keystone State, check out our Principles of Transportation Funding along with a commentary I co-authored last year on Pennsylvania's "Fork in the Road" in road spending.



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