William B. Cassidy, Senior Editor | Apr 03, 2012 5:10PM EDT
A bill introduced in Congress Tuesday would eliminate the excise tax on heavy trucks and trailers and replace that revenue with a higher diesel fuel tax.
Reps. Jim Gerlach, R-Pa., and Earl Blumenauer, D-Ore., introduced legislation in the House that would repeal the 12 percent excise tax and raise the fuel tax 6.3 cents.
In Don Quixote fashion, Reps. Gerlach and Blumenauer may be tilting at fuel pumps. House Republicans and the White House both oppose raising federal fuel taxes.
But the legislation underscores the need to find a mechanism to replenish the Highway Trust Fund, which gets 90 percent of its funds from federal fuel taxes.
House Republicans hoped to bolster the Highway Trust Fund with new revenue from oil and gas drilling and exploration, a move Democrats oppose.
An analysis by the Congressional Budget Office estimates the House Republican plan would create a $9.4 billion shortfall in the Highway Trust Fund by fiscal 2021.
Several states discouraged by federal gridlock on transportation funding are considering raising their own fuel taxes, with little or no success so far.
The American Trucking Associations hailed the Gerlach-Blumenauer bill as a means to not only reinforce the trust fund but also to boost U.S. manufacturing.
Eliminating the excise tax on heavy trucks would cut more than $15,000 from average truck price tag, reducing a cost that has risen sharply in recent years.
“It is exactly the kind of pro-growth, deficit-trimming legislation that lawmakers should be looking at,” said Bill Graves, the association’s president and chief executive.
Contact William B. Cassidy at wcassidy@joc.com. Follow him on Twitter at @wbcassidy_joc.
