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1 Chris R. Edwards, The Price of Mobility: Gasoline Taxes in America 1 (1993)

handle is hein.taxfoundation/srccxz0001 and id is 1 raw text is: TAX I W FOUNDATION June 1993, No. 22 The Price of Mobility: Gasoline Taxes in America Overview In 1992, the federal government raised $15 billion from the 14.1-cent per gallon federal gasoline tax. Most of this revenue flows into the federal Highway Trust Fund and is sent back to the states in the form of federal aid for highways. (See Figure 1.) States themselves raised $20 billion from gasoline excise taxes in 1992. State gas tax rates currently range from 7.5-cents per gallon in Georgia to 26-cents per gallon in Rhode Island. The current average combined federal plus state tax rate is 32.9-cents per gallon. Figure I Path of Funds Collectedftoin Federal Gasoline Taxes, 1992 Other Revenue $4.5 billion erl Gaoln 4@S $12.2 billion (11.5c/9al.) - Federal Deficit Reduction (2.5 C/gal.) - Urban Mass Transit Grants to States Leaking Underground Storage Tank Trust Fund (0.1C/gal.) SoUrCC: ' AX Fotlndatioll On average, each American paid $142 per year in federal and state gasoline excise taxes in 1992. This translates into a per-driver burden of $212 annually. (See Table 1.) In addition, state general sales taxes and other state and local charges increase the price of gas at the pump. Higher federal gasoline taxes may be coming down the road as Washington considers its tax increase options. Proposals for a motor fuels tax hike may boost gasoline prices 4.3-cents per gallon at the pump-a 31 percent hike in the federal excise on gasoline. The Federal Gasoline Tax Labyrinth Of the 14.1-cent federal gasoline tax, 11.5 cents from each gallon flows into the federal Highway Trust Fund and from there most flows back to the states as federal aid to states for highway projects. Since the 1990 Budget Agreement, 2.5 cents of the 14. 1-cent tax is allocated to the general fund of the federal Treasury for deficit reduction, and 0.1 cent goes towards the Leaking Underground Storage Trust Fund. President Clinton's budget makes these two temporary diversions from the Highway Trust Fund permanent. In 1992, $12.2 billion flowed into the Highway Trust Fund from the gasoline tax, along with $4.5 billion that flowed into the Fund from other sources, including $3.3 billion raised from the federal diesel fuel excise tax. The current federal diesel fuel excise rate is 20.1-cents per gallon. Of the $16.7 billion Highway Trust Fund receipts in 1992, $15 billion was sent back to the states in federal grants for highways. State Gasoline Taxes Every state plus the District of Columbia levies a gasoline excise tax on top of the federal tax (in addition to levying excise taxes on diesel 1v Chris R. Edwards Economist 7ax Foundation J

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