Free Minds & Free Markets

Should Infrastructure Spending Be State, Local, or Federal?: New at Reason

We shouldn't be raising the federal gas tax to pay for local infrastructure projects.

Road constructionMartin Finnerty/Dreamstime.comWith the Trump administration's proposal to add $200 billion of federal funding for transportation projects over the next decade, there's a renewed debate about whether we should raise the federal gas tax. One side makes the argument that a 25-cents-per-gallon gasoline tax is needed and long overdue; the other side says the hike would cost consumers $71 billion, or 60 percent of the expected gains from the recent tax cuts. But neither side is asking a more fundamental question: Should the federal government be involved in infrastructure spending at all?

Yes, it is true that the federal gas tax of 18.4 cents per gallon hasn't been raised since 1993. It is also true that when adjusted for inflation, it has less purchasing power now. It is also correct that the gas tax hasn't been enough to cover the annual amounts that Congress has authorized to be spent on transportation infrastructure in recent years, writes Veronique de Rugy.

Photo Credit: Martin Finnerty/


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