Is ‘Washington Outsider' Trump More Open to Gas Tax Hike?

By Stephanie Beasley

Dec. 8 — Rep. James B. Renacci (R-Ohio) is planning to introduce legislation next year that would raise the federal gas tax. And a construction industry official thinks the idea could get more traction with “Washington outsider” Donald Trump in the White House than it had with the Obama administration.

Renacci, a member of the House Ways and Means Committee, told Bloomberg BNA that he plans to put a proposal to raise the federal gas tax back on the table in the next Congress and hopefully in time for it to be considered as the Trump administration develops a $1 trillion infrastructure proposal.

Renacci introduced a bill last year that would have indexed the 18.4 cents-per-gallon gas tax to inflation and established a bipartisan, bicameral transportation commission to develop a long-term funding mechanism.

“I’m hoping that we get another look at it,” he said. “My plan is to re-drop that bill.”

Brady Wants Tax Repatriation

Renacci said increasing the gas tax, a user fee, would be a more feasible way to generate revenue for infrastructure projects than a one-time tax on repatriated corporate earnings, a plan that Committee Chairman Kevin Brady (R-Texas) told reporters this week he favored.

“We’d take those dollars from that one-time repatriation and plow it back into a more competitive tax code for all Americans,” Brady said on Dec. 7. “We think that’s important. We know others want to have a discussion about that.”

President-elect Trump has floated the idea of offering tax breaks to private companies that invest in state and municipal infrastructure projects. His transition team also has indicated that an infrastructure bank could be part of the proposal.

Brady said Trump’s team hadn't reached out to him with any ideas about how to pay for the $1 trillion infrastructure plan they are working on and that Trump said he plans to introduce within the first 100 days of his taking office.

Rep. Earl Blumenauer (D-Ore.), another Ways and Means member, recently said Trump’s infrastructure proposal would more likely result in renewed talks about transportation user fees than a reopening of the $305 billion FAST Act enacted last year, which will fund highway and transit programs through 2020. Renacci agreed. He said his gas tax bill is meant to reignite funding talks ahead of the next surface transportation reauthorization.

Industry Waits for Trump to Weigh In

Trump might be more open to the idea of raising the gas tax than most Washington conservatives who worry that backing a tax increase could hurt his or her chances for re-election, said Bill Sandbrook, president and chief executive officer of construction materials company U.S. Concrete Inc. The company supports increasing the gas tax, as do other key groups including the American Road and Transportation Builders Association and the U.S. Chamber of Commerce.

“[W]hen you look at any attempts over the last 20 years to raise the gas tax, it’s been traditionally the Republicans that have killed it,” he told Bloomberg BNA. “And no president has had the political will or courage to force that through. In this instance with a Trump president, although they’re not talking gas tax, here we have a chance. As an outsider, he’s not beholden to either party, and he’s there to shake things up and fix things on a long term basis.”

Trump’s transition team didn't respond to a request for comment on whether the new administration would support a gas tax increase.

However, it should be noted that Trump’s pick for transportation secretary, Elaine Chao, helped develop a surface transportation bill that increased the gas tax by 0.5 cents when she was the second highest official at the Department of Transportation in 1991. The gas tax hasn't been raised since 1993.

Sandbrook said that if Chao supports a gas tax increase, it could lead to “back door dialogue” with her husband, Senate Majority Leader Mitch McConnell (R-Ky.). That could help get Senate Republicans on board with the idea, he said.

To contact the reporter on this story: Stephanie Beasley in Washington at sBeasley@bna.com

To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com

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