Gas tax hike is a bad idea

As our economy struggles with the worst recession in recent memory, the New Hampshire House just passed a measure that would hit low- and middle-income Americans directly in the wallet. The mechanism is an effort to nearly double the state gas tax.

To offer a bit of background, the Legislature recognized that the state’s highway fund is rapidly eating up the trust fund that has been built up to pay for the state’s bridges and roads. Their solution, much like the answer this Legislature has for most problems, is to hike taxes. However, this economically damaging tax hike is unnecessary, because it doesn’t address the real problem.

The state’s constitution mandates that all gas tax dollars be used for highways. However, state agencies have used loopholes to offset general fund expenditures with highway funds. Now, over one-third of the highway fund pays for things from the court system to environmental protection to information technology. Is it any wonder that the system is going broke when the Legislature is siphoning so much off the top?

Did the big-spending Legislature consider telling these other agencies to get their noses out of the trough of the highway fund? Of course not! Their solution was more taxes at a time when our citizens can barely afford to make ends meet.

The tax hikers would have you believe that the only impact you would feel would be the increase at the pump. That would be more than enough reason to oppose this raid on our wallets in this tough economy, especially when you consider that many people have to travel farther to find work these days.

However, every good that is transported requires fuel to get the products on the shelf or into the hands of somebody preparing it. That means higher prices at the supermarket, the clothing store and at restaurants across the state. Taxpayers are going to get hit from all sides if this tax hike goes into effect, and the downstream impacts will be far greater than any of the proponents would ever admit.

An even greater impact would hit the economies of the border communities near Maine and Massachusetts. Given that the gas taxes of those two states are far higher than New Hampshire’s, many people come across the border to fill up at the pump. However, when they buy their gas here, they also buy a number of other goods, adding a much greater impact to our economy.

Nearly doubling the gas tax would strip away the advantages these small businesses have to compete against their counterparts over the border. Less revenue means fewer jobs, which adds another negative consequence to this tax hike. At a time when layoffs are already a daily reality, this is hardly a good policy.

When anyone with a clear perspective of the big picture looks at the prospect of a gas tax increase, it is a losing proposition. The effect on our economy is vastly greater than “just a handful of pennies per gallon at the pump,” as some might suggest. This tax hike will add up to real dollars in the pockets of the working families in the Granite State.

That’s why we need to approach our senators and emphatically tell them that a gas tax hike is a terrible idea for New Hampshire. They need to know that the problem is not enough money in the highway fund, but too many state agencies with their hands in the cookie jar, draining away money that we need to keep our drivers safe with good roads and bridges.

We can avoid a whole lot of economic suffering if we can find the discipline to make government work for the people, not the other way around. There is still time to stop this destructive cash grab.

Corey R. Lewandowski is state director of Americans for Prosperity New Hampshire.

Categories: Opinion