Sen. John Kerry, D-Mass., said the bill that he and two other key senators are preparing to combat carbon-caused climate change will not include a tax increase on motor fuels or even a “linked fee” on oil, despite widespread reports they would propose one.
That would be good news for the transportation sector, which was so alarmed that the climate bill would increase gasoline and diesel taxes that a broad industry coalition recently warned the senators against that course. (See “Climate Bill Tax Seen Competing With Highway Fee”).
Kerry is developing the bill along with Sens. Lindsey Graham, R-S.C., and Joseph Lieberman, I-Conn. The three are expected to unveil it April 26.
The industry groups fear that if climate legislation tacks on a motor fuels tax hike or a new carbon-linked fee at earlier stages of oil and gas production, which the lawmakers were also reportedly considering, this would crowd out the possibility of raising the gas tax later to fund a new multi-year bill for surface transportation programs.
The motor fuels tax feeds the Highway Trust Fund that disburses money to states for much of the nation’s road and bridge projects plus some intermodal facility construction. Similarly, the barge industry pays per-gallon fuel taxes into a fund that helps cover lock repairs, while airlines pay a fuel tax to help cover aviation facility operations.
Kerry told reporters Tuesday in the Capitol Building that “there is no gas tax, never was a gas tax,” according to The Hill newspaper. He also said “I don’t know where that came from, but it is just wrong. Period.”
That and other publications reported that Kerry also said “there is not even a linked fee” or anything similar in the legislation.
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