Vermont’s High Gas Prices to Get Worse: Gas Tax Hikes on the Way

by Robert Maynard

Despite the fact that the average price of gasoline in Vermont is 10 cents per gallon higher than the national average,  legislative committee has decided to add to our already high gas prices by approving a higher gas tax.  As pointed out in a recent True North Reports article, Vermont’s average price per gallon for gasoline is $3.75.  This compares to a price per gallon of $3.65 as a national average.  This same article pointed out that, after a steep increase at the end of 2012, the price of gasoline has been dropping.  The problem is that oil prices and wholesale gasoline prices have recently increased.  Higher retail prices are likely to follow.  So what does our political leadership in Montpelier intend to do to help relieve some of the burden?  According to a WCAX article, they intend to raise taxes on gasoline:

A controversial gas tax is moving forward at the Vt. Statehouse. While some Republicans may not like it, they appear to be along for the ride.

The bill passed out of the Transportation Committee with unanimous support from Republicans and Democrats. It would add a 2 percent sales tax to the price of gas before state and federal gas taxes are added on. The change would take effect in May. Resulting in a total 6.8-cent per gallon state tax at the pump. By July of next year, the sales tax would increase from 2 percent to 4 percent. But the existing fixed-tax will be lowered, resulting in an overall state gas tax of around 7.7 cents per gallon.

Of course the excuse for the tax hike is to make up for the Transportation Fund shortfall.  Art Woolf posted an article in January on the Vermont Tiger website that pointed to a question nobody was asking in regards to this whole matter.  Woolf starts out by quoting a Vermont Digger article to illustrate the problem:

Vermont’s transportation system faces an annual shortfall of $240 million over the next five years. A new report predicts the average gap between the state’s annual funding sources, roughly $457 million, and the cost of paying for basic infrastructure needs, estimated at $700 million per year.

This year alone Vermont will see a roughly $30 million gap in state transportation revenues, according to Rep. Patrick Brennan, the chair of the House Transportation Committee.

He then raises a question very few others want to ask in regards to why we have the shortfall to begin with:  “In the stories that have reported on this, no one seems to have mentioned that each year about $30 million in purchase and use tax revenues — one-third of the tax you pay when you buy a new or used vehicle — goes to the education fund, not the transportation fund. A good example of how Vermont’s high level of spending on K-12 education starves other functions of government.

It seems that a the the state’s Democratic leadership, and a few Republican enablers, see tax increases as a solution to just about everything.  Does it ever occur to them that it might be a better idea to get a handle on their spending addiction?

3 thoughts on “Vermont’s High Gas Prices to Get Worse: Gas Tax Hikes on the Way

  1. Pat Brennan is one:

    ‘Republican Committee Chair Pat Brennan thanked fellow committee members for sticking their necks out on the issue.

    “It’s kind of an insurance policy that insures us that we won’t have to be back here in another three to four years looking for another gas tax increase,” said Rep. Brennan, R-Colchester.’

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