There's been a lot of talk lately about a gas tax holiday during the summer months. The idea is to suspend the federal gas tax in order to give consumers a little relief at the pump. This idea is so very bad for a lot of different reasons.
First, the federal gas tax pays for the Highway Trust Fund. A good chunk of that money is also distributed to state highway departments. You know, for things like interstates and bridges and other wonderful things that, as a driver, I've come to really love.
Second, suspending the federal gas tax isn't going to save the average consumer that much money, even assuming a best case scenario where prices are not raised by oil companies to cover the drop in price.
Let's do the math. Gas is currently $4 per gallon. Of that $4, 18.4 cents is the federal gas tax. My small car has a 12 gallon gas tank. It costs $48 to fill the tank, of which $2.21 is the federal gas tax.
Assume that the federal gas tax is suspended from Memorial Day through Labor Day. This is 14 weeks. Now, assume that I need to fill my gas tank once per weak (it's actually more like once every 2 weeks, since I don't drive to work). In 14 weeks, I will have paid $30.94 in federal gas tax. That's right, suspending the federal gas tax will save me a whopping $31 throughout an entire summer.
It's estimated that the federal gas tax holiday will cost the Highway Trust Fund 126 million dollars. All while saving consumers $31.
No thanks. Keep the 30 bucks. I'd rather have roads and bridges.
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