Gov. Gretchen Whitmer released her FY 2020 budget proposal on March 5, among other things, that would raise Michigan’s gas tax by 45 cents.
If enacted, there would be a 15 cent increase in October 2019, another 15 cent increase the following April and then a final 15 cent increase in October 2020.
This proposed hike would raise approximately $2.5 billion, which is around the figure a bipartisan commission calculated the state’s roads needed to be adequately repaired.
According to the Southeast Michigan Council of Governments, only 19 percent of federal aid-eligible roads in southeastern Michigan are in good condition. This includes most major roads, not including side-streets like subdivisions. Meanwhile, 41 percent are in poor condition.
It’s clear that Michigan’s roads need help, just ask Michigan voters. Before the 2018 midterm election, improving roads and infrastructure in the state was the number one issue of voters. 27 percent of respondents said it was their number one issue, while only 7 percent said that lowering state and local taxes topped their list. Michigan voters want a solution to the terrible conditions of our roads.
Those who use the roads should be the ones to pay for repairs. The more you drive and use the roads, the more you pay at the pump. While increasing the gas tax is a reasonable way to repair Michigan’s failing roads, such a high increase, like Gov. Whitmer has proposed, could be a disadvantage to Michigan families and the economy.
Some opponents have suggested other forms of taxes to raise money to “fix the damn roads,” such as taxing companies like Nestle that utilize Michigan’s natural resources.
Nestle only pays $200 annually to the state to pump water from the wells it owns. Over 130 million gallons were pumped out from just one of its wells in 2017. Nestle takes advantage of Michigan’s natural resources and gives little back to the state. The least it could do is help fund our crumbling infrastructure, which helps the company make its billions of dollars in yearly profits.
Such a dramatic increase in the gas tax would be harmful to the state, however, increasing the tax by a much smaller amount is fair. A reasonable solution is to increase the tax by around 15 cents, while making up the rest of the revenue in new taxes on ultra-rich companies. This lessens the burden on Michigan citizens and the economy while still generating the revenue necessary for the repairs.
Additionally, while increasing the gas tax would generate substantially more revenues short term, over the long term it could provide people incentives to reduce their use of less fuel-efficient vehicles. This could be a great benefit to the environment, especially with the looming threat of climate change.
Increasing the gas tax is a reasonable solution, but the dramatic 45 cent hike that Gov. Whitmer has proposed is outrageous.
