A proposed gas tax holiday in North Carolina as a temporary reprieve from record-high gas prices is being condemned by lawmakers hoping to cut costs at the pump long term.
Across the United States, many democratic lawmakers are pushing for gas tax holidays as a way of creating a short-term fix to record-high gas prices. But Maya MacGuineas, an opinion contributor for The Hill and president of the bipartisan Committee for a Responsible Federal Budget, explained how a gas tax holiday could potentially amplify the climate crisis and slow the development and adoption of cleaner technologies.
"A gas tax holiday would exacerbate inflationary pressures and slow a needed transition to more energy-efficient and climate-friendly technologies while cutting off a key source of infrastructure funding," MacGuineas said. "It’s a way for politicians to pretend they are making the situation better, when in fact they are making it worse."
CNET reports that gas taxes are already failing at keeping up with rising infrastructure costs, which have worsened with the rising popularity of electric vehicles. Currently, the federal fuel tax rates are $0.184 per gallon for gasoline, with North Carolina's state gas tax being $0.385 per gallon, according to IGEN. While a gas tax holiday may sound like a temporary reprieve, some economists warn that it could make the problem worse while also not addressing any of the issues involving the oil supply.
"Rather than countering the highest inflation rates seen in decades, suspending the gas tax in an overstimulated economy would boost inflation in 2023, as surging demand coincides with re-imposition of the tax," MacGuineas continued. "Remember, it was excessive tax cuts and spending that helped get us into this inflation mess; they aren’t going to get us out of it."
The topic continues to divide North Carolina lawmakers, with Jordan Monaghan, the Press Secretary for North Carolina Governor Roy Cooper's office, announcing that eliminating or reducing the state gas tax is an issue the administration is reviewing carefully, according to ABC News 12. Mike Clampitt, a Republican representing the state's 119th District, also shared that the state gas tax is "probably the largest source of revenue" for the state's Department of Transportation and is used to fund many different transportation and infrastructure projects. The only way to bring down pump prices would be to increase domestic oil production, according to ABC 13.
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