More on the gas tax

Been posting to the blog Hammer of Judgement in comments, but thought I ought to excerpt the last comment here too:

#1: It doesn’t matter WHY they drive less, if you’re just measuring the regressivity of the gas tax. Whether it’s because they don’t have to, don’t want to, or CAN’T is irrelevant.
#2: Texas “highway system” comprises only roads with route shields on them, and even then, substantial donations in the form of property and sales taxes are required these days to get anything built. In addition, in Texas, most major arterials inside cities are NOT part of the state highway system, and thus get ZERO gas tax dollars.
This is not something you want to dispute me on, it’s the closest thing to a specialty I have. Here’s some starter links for you:
http://mdahmus.monkeysystems.com/blog/archives/000173.html
http://mdahmus.monkeysystems.com/blog/archives/000164.html
http://mdahmus.monkeysystems.com/blog/archives/000122.html
pictures:
http://mdahmus.monkeysystems.com/blog/archives/000117.html
entire category:
http://mdahmus.monkeysystems.com/blog/archives/cat_funding_of_transportation.html
#3: On anectdotes – the studies I cited aren’t available in their full form on the web (to me or you), but they go WAY beyond anectdotal data, since there are real studies behind those quotes, unlike most of the people who assert the gas tax’ regressivity.
#4: I don’t know where the 15% figure comes from; but even if true, the STATED REASON most people harp on the supposed regressivity of the gas tax is concern for the poorest people, not the middle class. Thus, showing that it’s regressive across middle and high incomes but NOT low incomes serves to refute the essential point.

Note that I cover the topic of roadway funding extensively in this category, including “what roads get gas taxes and what don’t”, “how do we pay for major roads”, “why does the state effectively subsidize the suburbs through the gas tax”, etc.

The Gas Tax Isn’t Regressive, Part Three

(at least, not regressive across the spectrum) – as I’ve argued here and here, the gas tax doesn’t hit the poor that hard; it mostly hits the exurban parts of the middle class and leaves the rich alone. From my original article on the subject:

The supposed regressive nature of the gas tax is a fallacy – in fact, poor people spend far less proportionally on gasoline than do the upper-middle-class.
The gas tax isn’t purely progressive; though; the very rich actually spend less proportionally than do the upper-middle-class, due to their tendency to be either in the few healthy downtowns, or less need to drive overall.

Here’s another link I found today which asserts the same:


“A subsidy to new vehicles would be regressive. A tax on
gasoline is not regressive across the lowest incomes but is regressive from middle to high
incomes.”

Note that the internet is replete with sites which say that the gas tax is regressive, but the only articles or studies which actually include any supporting arguments are the few that claim that it isn’t regressive. This leads me to believe that the gas tax ISN’T regressive, for the reasons previously discussed, and that the ‘conventional wisdom’ is wrong here.

This is timely because of a current thread on Environmental Economics on this very subject. Amazingly, I’ve now provided THREE links which are credible and contain supporting evidence for the claim that the gas tax isn’t regressive across-the-board; for the most part blind assertion is still the only support for the ‘regressive’ position. Moral: Conventional Wisdom is hard to fight, even when it’s wrong.