Sen. Carper to Propose Gas Tax Increase at June 26 Trust Fund Hearing

Sen. Tom Carper (D-Delaware) said he plans to propose an increase to the national gas tax as a way to generate money for transportation projects when the Senate Finance Committee meets to advance a short-term boost for a federal highway account.

The Finance Committee is scheduled to meet June 26 to consider a bill offered by the panel’s chairman, Sen. Ron Wyden (D-Oregon), that would approve $9 billion to keep the cash-strapped Highway Trust Fund solvent through the end of the year. (UPDATE: Senate panel drops truck tax, postpones vote)

The Transportation Department estimates the fund will run out of money sometime next month.

On June 25, Carper, who sits on the Finance Committee, said he will call on colleagues to support a proposal that would provide annual 4-cent increases in the gas and diesel taxes until the gas tax reaches 30.3 cents per gallon and the diesel tax reaches 36.3 cents per gallon.

The revenue generated by Carper’s plan would be dedicated exclusively to the Highway Trust Fund. Currently, the gas tax is at 18.4 cents per gallon, and the diesel tax is at 24.4 cents per gallon.

“Multiple bailouts of the Highway Trust Fund have added more than $54 billion to our nation’s debt since 2009,” Carper said. “I still believe that re-establishing the purchasing power of the fuel tax is the best policy for funding our federal transportation program. Indexing these taxes to inflation is a common-sense way to ensure the value of these transportation user fees does not continue to erode.”

Carper’s plan will face tough opposition since Republicans on the committee have indicated they would not support raising taxes. Also, the Obama administration recently reiterated it would not support raising the gas tax.

Carper’s plan comes just a few days after Sens. Chris Murphy (D-Connecticut) and Bob Corker (R-Tennessee) offered a different proposal to raise the federal gas tax to shore up the trust fund, which is used to reimburse states for investments in highway and transit projects.

According to DOT, if Congress allows the highway account to approach bankruptcy, states’ ability to pay for road and transit projects would be put at risk.