Saturday, July 20, 2024

Louisiana business group says proposal to increase gas tax will not be filed

by BIZ Magazine

By David Jacobs | The Center Square

 A Louisiana legislator will not move forward with his planned bid to raise the state’s gasoline tax this year, according to a business group that backed the plan.

Erich Ponti, president of the Louisiana Coalition to Fix Our Roads, wrote Thursday in a letter to supporters that Rep. Jack McFarland no longer plans to file his Government Reform in Transportation Act and instead will “focus on identifying alternative funding sources that can gather the votes needed for passage.”

The recently passed American Rescue Plan could provide a “significant infusion of one-time resources,” Ponti wrote.

Louisiana drivers pay 38.4 cents a gallon in taxes on gasoline. The state’s portion of 20 cents has not increased in three decades.

McFarland, a Winnfield Republican, had discussed legislation that would increase the gas tax by 10 cents a gallon, then add 2 cents a gallon each year until the increase reaches 22 cents. Each additional penny in tax would raise about $30 million, and the additional money would help state officials draw down $780 million in federal money that otherwise would go to other states, McFarland said.

Louisiana, which often is described as having some of the worst roads and bridges in the country, has a $15 billion road maintenance backlog and a $13 billion wish list for new projects, according to state officials, which helps drive calls for more revenue.

Tax increases, however, always are controversial and may be even less palatable to lawmakers because of the current economic uncertainty related to the COVID-19 pandemic. Gov. John Bel Edwards cited that uncertainty to explain why he was not backing the tax increase and why he didn’t think it would get the votes of two-thirds of the members of each chamber in the Louisiana Legislature. A two-thirds is needed for a tax increase.

The last attempt to raise Louisiana’s gas tax was during the state election year of 2019.

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