Report: Gas tax changes needed

Washington should make changes to the gas tax and rely more on municipal bonds to help fill the gap in the Highway Trust Fund, the Brookings Institution says in a new paper. 

The think tank proposes linking the gas tax to gas prices, which it says would reduce price fluctuations at the pump. Under the plan, the gas tax would fall when gas prices rise, and then increase when prices are lower. 

{mosads}The study’s authors propose a minimum and maximum amount for the tax, with the minimum coming in below the current 18.4-cent-per-gallon standard. Brookings also proposes tying the gas tax, which hasn’t been raised in more than two decades, to inflation. 

Other ideas floated by the paper include restoring the Build America Bonds, a policy long championed by Sen. Ron Wyden (D-Ore.). 

More long-term ideas include having more national collection standards for the collection of tolls, instead of regional outfits like E-Z Pass and FastTrak.

Congress is once more up against a deadline for highway funding, but top Republicans have said there’s no chance for a gas tax increase. Republicans are currently debating short-term patches for the highway program, while Democrats have chided the GOP for not offering a more long-term solution.

The Brookings study’s authors include Alan Krueger, a former top economist in the Obama administration, and Roger Altman, a deputy Treasury secretary under former President Clinton.