Inflation is hard on Americans, and there are several policies that might effectively address it. A proposal from a group of Senate Democrats to provide a “holiday” from the federal gas tax until the end of the year is not one of them.
The concept of suspending the gas tax is not new. Back in April of 2008, presidential candidate Barack Obama criticized the idea when it was proposed by rival candidates John McCain and Hillary Clinton. At that time, inflation had already substantially eroded the real revenue impact of the tax. More than 14 years had passed since Congress had set it at 18.4 cents per gallon of gasoline and 24.4 cents per gallon of diesel back in October of 1993. Today, almost another 14 years have gone by, and Congress still has not raised the tax from its 1993 levels. The real revenue impact of the tax has fallen even more and the argument for suspending the tax is weaker than ever.
In the meantime, cars have become more fuel-efficient, which is a positive development for the environment and for consumers – and it also means that Americans pay less gas tax.
