Who Supports a Federal Gax Tax Hike or Alternatives?

• In Event: From Gas Tanks to the Grid: Impact of Taxation on Energy Consumption

Abstract

This study examines the question of individuals’ support for a federal gasoline tax increase or alternative fees. The U.S. federal excise tax on gasoline (18.4 cents per gallon) has not been increased for more than twenty years and is proving to be an inadequate source of funding for the Highway Trust Fund. Increasing gas mileage of the existing automobile fleet reduces the yield of the gasoline tax resulting in inadequate funding relative to the expenditure needs of the federal highway system. Responses to a national survey conducted in 2024 regarding the prospect of an increased gasoline tax or alternative fees are analyzed using ordered logit models to determine who supports an increased excise tax or alternative fees. Results indicate that men and those employed are more likely to support while the elderly are less likely. Democrats are more likely to support. Those who drive more annually and those who report driving on bad local streets and roads are less likely to support. Urban area residents are more likely to support. Unsurprisingly, EV drivers are much more likely to support a gas tax increase. Support for two alternative fees, including a vehicle miles traveled (VMT) fee and a variant of the VMT based on a vehicle’s pollution are also examined. Using a generalized ordered logit (GOLOGIT) modeling approach, associations between reported support and independent variables are revealed to vary with categorical response levels providing more nuanced insight on who supports a higher gas tax or alternative fees.

Author

• John Anderson, janderson4@nebraska.edu