It's Just Politics with Zoe Clark and Rick Pluta
This week's It's Just Politics is all about the politics of gas taxes; there’s a turbo-charged effort this week at the state Capitol to pull together a transportation funding package that will most likely include some kind of increase in the gas tax. Governor Snyder continues to say that he wants at least $1.2 billion dollars more in annual transportation funding. And, even though everyone seems to agree that Michigan’s roads are in dire condition… not everyone can agree on how to pay for the repairs.
It is a complicated state of affairs. Everybody hates the disease. But no one likes the cure: more money for infrastructure. That’s a good reason why the gas tax hasn’t been increased in Michigan since 1996, under then-Governor John Engler.
It’s not as simple as just raising the state gas tax (which is currently 19 cents per gallon). As we know, raising taxes is not typically part of the recipe for reelection, and every House member and state Senator who is not term-limited is up for reelection in November 2014, along with Governor Snyder.
Dealing with this road funding conundrum is complicated by the fact that we pay a lot of different taxes at the pump. There’s the state gas tax and the federal gas tax. We also pay the state sales tax, which goes to schools and local governments. It doesn’t pay for roads. That’s why a lot of people want to either exempt fuel sales from the sales tax or turn a portion of it over to road funding. But that’s a problem because then you’re taking a billion dollars from schools and local governments, both of which are not feeling a lot of love from Lansing lately. So, cut the sales tax from the cost of buying fuel and you’ve suddenly got yourself a new (billion-dollar) problem.