Suspending Pa.'s gas tax isn't the solution to our money woes
Paying for gasoline is painful right now.
In York, you can expect to spend an average of $4.29 per gallon of regular gasoline, according to Gas Buddy, a website that monitors prices nationwide.
That's led many states — including Pennsylvania — to consider suspending its tax on gas. Maryland, our neighbor to the south, and several other states already have.
Many state lawmakers — including leaders like Senate President Pro Tempore Jake Corman — are already on board, and Gov. Tom Wolf himself committed to a gradual phase-out of the state gas tax while simultaneously calling on Congress to end the federal one, a hypothetical savings of 18.4 cents per gallon.
Sounds good, right?
The state gas tax is a relatively small portion of what we all pay at the pump. Even in Pennsylvania, which has the highest state gas tax in the nation, the tax represents roughly 13% — or 58 cents — of what you're paying at the pump.
Where does that money go?
It helps maintain vital infrastructure, including roads and bridges — many of which are in dire need of funding, as evidenced by the recent collapse of a Pittsburgh bridge that left 10 motorists hurt. For now, it also supports the Pennsylvania State Police, who are the primary law enforcement for many rural communities.
Earlier this year, PennDOT told state lawmakers that it has a backlog of thousands of bridges in need of repair statewide that it can't pay for — even after the $1.6 billion the feds handed down via the Congressional infrastructure bill.
Starving our state of money for road and bridge repairs won't help anyone.
Granted, it's the only element lawmakers have under their control, and there's a lot of pressure for them to do something.
After all, our statewide elected officials can't do much about the larger inflation we're seeing across the board nor can they snap their fingers and resolve the Russian war in Ukraine that's exacerbated the gas price problem.
Unfortunately, there's no guarantee suspending the gas tax would do anything for the ordinary Pennsylvanian.
A recent report by the American Road and Transportation Builders Association found that two-thirds of all price changes between 2013 and 2018 canceled out gas tax decreases.
The day-to-day price fluctuations are largely driven by speculation in the oil commodity market, so any tax cut is liable to end up getting lost in the scrum.
Our lawmakers aren't necessarily wrong to consider decreasing the gas tax. If we cut any tax, it should be taxes like this one — that are felt more acutely by low-income Pennsylvanians.
So ... what could help ease the sting of rising prices?
We have a few suggestions.
First, Congress could restore expired child tax credit that helped low-income families.
Of course, that's also outside the control of Gov. Wolf and the Legislature.
If they want to have a more immediate effect, they could consider the so-called Fair Share Tax Plan (SB555), which would split the state's personal income tax — currently a flat 3.07% — into two separate taxes: laborers would pay 2.8% of their wages while business profits, capital gains and estates would be taxed at 6.5%.
Under that plan, the top 1% of taxpayers would shoulder the greatest burden: Someone earning $1.7 million per year, for example, would pay an additional $20,000. But the vast majority of Pennsylvania families — an estimated 60% — would pay less money in state taxes.
That's money they could use for food, housing and ... gasoline.