Incoming Transportation Secretary Pete Buttigieg suggested raising the federal gas tax to fund infrastructure initiatives. He made the announcement at his confirmation hearing before the Senate Commerce, Science and Transportation Committee.
Florida Republican Senator Rick Scott asked Buttigieg if he would support a federal gas tax increase to pay for the Highway Trust Fund.
Buttigieg responded, “Well, I think all options need to be on the table. As you know, the gas tax has not been increased since 1993, and it’s never been pegged to inflation. And it’s one of the reasons why the current state of the Highway Trust Fund is that there’s more going out than coming in.”
The federal gas tax is currently 18.4 cents per gallon, according to the Tax Policy Center. The rate was raised 10 times between 1933 and 1993, but has not been increased since then.
Buttigieg then raised questions about the long-term effectiveness of a gas tax increase, given the growing trend towards renewable sources of energy.
“In the long term, we need to bear in mind also that as vehicles become more efficient and as we pursue electrification, sooner or later there will be questions about whether the gas tax can be effective at all,” he said.
But Buttigieg did say that he would consider “revisiting the gas tax, adjusting it or connecting it to inflation” in the short term.
Utah Republican Senator Mike Lee brought up the issue a second time during the confirmation hearing. Buttigieg again responded with the idea of a gas tax increase. However, he did not say for sure whether or not he would propose one.
“Well it’s possible,” he said. “Certainly many states have taken that step, including my own, but it’s not the only approach.”
“Certainly one of the concerns with the gas tax is it’s likely not as progressive as the federal income tax, for example,” Buttigieg added.