Branstad wants to build support for gas tax hike

Former Governor Chet Culver and former Republican gubernatorial candidate Chris Rants were vindicated today, as Governor Terry Branstad "encouraged transportation stakeholders to build support for a gas tax increase next year," James Q. Lynch reported.

Last summer, Branstad said the timing wasn't right for a gas tax increase, and today he told "representatives of highway associations and coalitions, local elected officials, engineers, economic developers and other stakeholders" that this year fiscal issues will take priority. Still, he made clear that he supports raising the gas tax to pay for more road construction in the future:

Having the resources to maintain and improve the transportation system is "absolutely critical to our goal of creating 200,000 jobs and raising incomes by 25 percent and making Iowa a growing and competitive state," Branstad said.

That was welcome news to the transportation stakeholders who have lobbied in recent years for a gas tax increase to provide those resources. [...]

"I want to team with you and help in this effort because I see it as part of what is critically important to our economic development success and achieving our ambitious job creation goals and income growth goals," Branstad said.

According to Lynch, Branstad "repeatedly referred to motor fuel taxes as user fees that benefit motorists who pay it." Earlier this month, a report by Iowa Public Interest Research Group demonstrated that "gas taxes cover barely half the costs of building and maintaining roads," and "[t]he amount of money a particular driver pays in gasoline taxes bears little relationship to his or her use of roads funded by gas taxes." The governor isn't worried about taxpayers subsidizing roads for other people, to the tune of hundreds of millions of dollars a year, but he's deeply troubled by a small subsidy for passenger rail.

I wouldn't be surprised if Branstad backs a sales tax increase a year or two down the road. Last April, he told the Sioux City Journal editorial board that his "long-range plan" on taxes was "to have more of a thing on consumption." Shifting to draw more state revenues from consumption taxes (like the sales and gas tax) and less from income and property taxes would make Iowa's already regressive tax structure even worse.

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