Newspaper article THE JOURNAL RECORD

U.S. Gasoline Tax May Spell Revenue Trouble for States

Newspaper article THE JOURNAL RECORD

U.S. Gasoline Tax May Spell Revenue Trouble for States

Article excerpt

Federal budget-makers are considering a hefty increase in the gasoline tax that, if enacted, could spell serious revenue problems for state governments, an expert from the National Conference on State Legislatures said Tuesday.

While President-elect George Bush has promised no new taxes, that problem could be surmounted by increasing an existing tax, like the federal gasoline tax, Michael Bird, federal affairs director for the conference, told the Oklahoma House Appropriations Committee.

He said federal budget-makers are currently discussing increasing the federal gas tax by 25 cents a gallon or more.

``They're not talking pennies - they're talking nickles, dimes and quarters, particularly quarters,'' he said. ``It's going to have a resounding impact on state revenue,'' because such a large increase would decrease gas consumption, therefore reducing revenues from state gas taxes.

Under questioning by committee members, Bird said the odds of a federal gas tax increase in the next two years are ``awfully, awfully good'' in the House of Representatives, but not so good in the Senate.

``My sense is, if it gets down to the point they have to increase revenues, that's what they'll go to because they can say it's not a new tax,'' he said.

The state currently levies a 16-cent tax on every gallon of gasoline, while the federal tax per gallon is about 9 cents, the Oklahoma Tax Commission said.

It will be months before Oklahoma lawmakers know how much money to expect from the federal government for the next fiscal year, but early indications are it won't be more, and could be less, than this year, Bird said.

``Fiscal year 1988-89 was very good in terms of state and local assistance'' from the federal government, he said. …

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