Transportation Secretary Pete Buttigieg said on Monday that there is no current provision in the $3 trillion Biden infrastructure plan to increase taxes on gas or mileage.
“That’s not part of the conversation about this infrastructure bill,” Buttigieg said on CNN when Jake Tapper asked him about an idea the secretary had floated of using a mileage tax as a way to subsidize roads, bridges, and tunnels construction. “Just want to make sure that’s really clear. But you will be hearing a lot more details in the coming days about how we envision to be able to fund this.” Buttigieg also denied that the infrastructure plan would result in a gas tax increase.
This walk back on the mileage tax follows Buttigieg saying on CNBC that it “shows a lot of promise.”
“I think that shows a lot of promise,” Buttigieg said on Friday. “If we believe in that so-called user-pays principle, the idea that part of how we pay for roads is you pay based on how much you drive. The gas tax used to be the obvious way to do it; it’s not anymore. A so-called vehicle miles traveled tax or a mileage tax, whatever you want to call it, could be the way to do it.”
Buttigieg received blowback for his comments from people who cited the fact that minorities and poorer citizens in rural areas would be disproportionally affected.
TFW you're concerned that student debt cancellation will unfairly benefit rich kids but love to tax folks who can't afford to live close to work. https://t.co/J237vsEgO1
— Briahna Joy Gray (@briebriejoy) March 26, 2021
Gas has gone up, and now the Biden administration wants to track each mile you drive and tax you for it?
This will hurt working class Americans.https://t.co/yr4sPNxx0f
— Tom Cotton (@SenTomCotton) March 26, 2021
During his confirmation hearing before the Senate Commerce, Science, and Transportation Committee in January, Buttigieg told Republican Florida Sen. Rick Scott that “all options need to be on the table” for a federal gas tax increase to subsidize the Highway Trust Fund.
“Well, I think all options need to be on the table,” Buttigieg said. “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.”
Today, the federal gas tax is 18.4 cents per gallon and was raised 10 times between the years 1933 and 1993. The rate has not increased since then, according to the Tax Policy Center.
Biden is expected to unveil the $3 trillion infrastructure plan in Pittsburgh on Wednesday, and while the plan’s particulars are unknown, it is expected to include a corporate tax rate increase to 28 percent from 21, an increase on income taxes for those making $400,000 or more, a greater estate tax, and a greater capital gains tax rate for people earning $1 million a year or more. The Chamber of Commerce warned that a tax hike of this level would “make the United States a less attractive place to invest profits and locate corporate headquarters.”
“You’re going to hear more details from the administration in the coming days about how to pay for this,” Buttigieg said. “You will be hearing a lot more details in the coming days about how we envision being able to fund this.”