December 14, 2018
To: Members of the Alabama Senate
From: Americans for Tax Reform
With the 2019 legislative session only a few months away, I write to encourage you and your colleagues to use the coming year to enact reforms that will help grow the state economy and protect taxpayers.
While there are many opportunities to improve Alabama’s tax and regulatory climate, it’s important to first do no harm. As such,
I urge that you reject the aggressive, but misguided push to hike the state gas tax
, a proposal that would diminish and, in some cases, could totally erase the relief that your constituents have received from federal tax reform.
Attempting to impose a regressive tax hike that will do the greatest harm to households who can least afford it is already bad enough. It’s even worse when it has already been documented that existing transportation dollars are not appropriately spent.
Ballot measures to hike state gas taxes were resoundingly rejected in Missouri, Utah, and Washington State just last month. Between that and the throngs of French citizens now protesting President Emmanuel Macron’s gas tax hike, which he just suspended, it’s clear that gas tax hikes are a political loser, both at home and abroad.
In addition to being terrible politics, the proposed gas tax increase is also bad policy. Consider that a state gas tax increase would counteract the benefits of federal tax reform and eat into Alabama taxpayers’ federal tax cut savings. This is one of the reasons why Congress has declined to raise the federal gas tax, despite pressure for them to do so; the same sort of misguided pressure that is currently being applied to you and your colleagues.
According to Strategas Research Partners, 60% of the federal income tax cut would be wiped out by a $0.25 gas tax increase and rising prices: