Time For A Gas Tax Increase in Maryland There’s a lot of talk around Annapolis these days about the structural deficit. This is one of those ‘deju vu’ moments: haven’t we heard all this before?

Most of us don’t have a clue about what this really means, or the details of government taxing and spending. Unfortunately, many of our legislators don’t either. But here is the simple primer: our government is costing more than we can afford, or we need to do more and can’t afford it. Something’s gotta give, and it’s usually the taxpayers.

Talk of deficits, structural or otherwise, quickly shifts to how to raise more money to pay for them. Now comes the question of choices that need to be made.

The debate has already started about which taxes to raise, or, to use the euphemism of public policy types, how to ‘modernize’ the state’s tax system. The Governor is rightly cautious about staking out a position before he has all the facts. Broad changes to tax policy will have an impact on the state’s economy, often in ways that can’t be anticipated entirely.

Nevertheless, there is one tax that the legislature and governor should not wait to increase, and that is the gas tax. The gas tax is the best user tax there is. It is simple to understand: those who drive, pay. If there is one thing that we should all be able to agree on it is that our state’s transportation system needs drastic improvement. Roads need to be maintained. Maryland is growing and the simple fact is that we are going to need more and wider highways. And all agree there isn’t enough money to do these things.

It is also a time to start making investments in public transportation. Revenue from gas taxes is one reason why other countries are able to pay for modern and efficient public transportation systems. With the exception of the DC metro, the region’s public transport is only slightly better than a third world country. Baltimore needs a Red Line connecting the east and west sides of the city. The region needs a high-speed rail connection that ties our growing population centers together.

We can also affect the environment and national policy. We shouldn’t kid ourselves that Maryland alone can make a difference, but we can at least set an example for that the federal government should follow. Increase prices of gasoline may reduce auto use, and reduced auto use will lower polluting carbon emissions.

Reduced driving also reduces demand for oil and will drive down world oil prices and the revenue that oil producing countries like Iran depend on to pay for their nuclear ambitions. The collapse of the Soviet Union was as much due to the price of oil going to $15 a barrel as anything else.

Senate President Mike Miller wants to increase the gas tax by $.12. Seems like good public policy to me.

Labels: Annapolis, flush tax, Maryland, oil

  11:30 AM •  1 Comments • Links to this post