Green Jersey

Clinton, Obama divided over gas tax break

Image via blog.usa.gov.

Hillary Clinton and John McCain want to give drivers a break this summer by suspending the federal gas tax of 18.4 cents a gallon. Barack Obama yesterday spoke out against the proposal.

The gas tax money goes into a fund for the construction and maintenance of roads and bridges. Clinton and McCain would make up the lost revenue in different ways — yesterday, Clinton said she’d introduce legislation to impose a windfall-profits tax on oil companies, according to the New York Times. McCain opposes such a tax and would make up the losses with other sources of tax revenue.

Obama, meanwhile, said yesterday that the three-month “holiday” would do more harm than good and save the average joe no more than $30. (Also rejecting the idea — back when it was McCain’s, before Clinton got on board — were readers polled by the Bergen Record’s Road Warrior, at a ratio of 5-2).

If the federal tax were junked for the summer, New Jersey drivers would pay just 14.5 cents tax on the gallon — the state’s gas tax. That’s bargain-basement, when you look at the state gas taxes of neighbors New York (40.9 cents), Connecticut (43.9 cents) and Pennsylvania (32.3 cents).

And it explains, in large part, why gas is so cheap here compared to most everywhere else. Should it be? While there are benefits to a low gas tax, there are also reasons to raise it for the first time in 20 years. Gov. Corzine apparently remains opposed to raising it, according to a story in today’s Star-Ledger, and plans to replenish the state’s depleted Transportation Trust Fund with small toll increases.