Group recommends fuel tax increase

| November 12, 2010
Commission urges raising fuel tax 15 cents.

The bipartisan National Commission on Fiscal Responsibility and Reform, created by President Obama to address the nation’s fiscal challenges, has recommended a gradual increase in the fuel tax to feed the Highway Trust Fund and pay for transportation spending.

The commission – charged with identifying policies to improve the fiscal situation in the medium term and to achieve fiscal sustainability over the long run – proposes to raise the fuel tax gradually by 15 cents beginning in 2013. That money would be dedicated toward financing the transportation trust funds, eliminating the need for further general fund bailouts that have occurred in recent years, according to the report.

Recently, U.S. Senators Tom Carper (D-Del.) and George Voinovich (R-Ohio) urged the commission to consider a 25-cent fuel tax increase. They suggested that 15 cents of the increase go toward the Highway Trust Fund and the other 10 cents temporarily be applied to national debt reduction. The federal fuel tax hasn’t been increased since the early 1990s.

The commission’s draft proposal is part of a proposed final report containing recommendations. The final report, due by Dec. 1, requires the approval of at least 14 of the 18 members of the commission, which is chaired by Alan Simpson, former Republican senator from Wyoming, and Erskine Bowles, former chief of staff to President Clinton.

The commission was created in February and tasked with proposing recommendations designed to balance the budget, excluding interest payments on the debt, by 2015. In addition, the commission was to propose recommendations that meaningfully improve the long-run fiscal outlook, including changes to address the growth of entitlement spending and the gap between the projected revenues and expenditures of the federal government.