Governor’s Highway Funding plan at least ‘a good start’

Our View

Governor’s

Highway Funding plan at least ‘a good start’

Since Republican Gov. Asa Hutchinson has made it clear, “NO NEW TAXES” as part of his plan to boost highway funding, it was inevitable there would be the critics saying the governor’s plan is short sighted, ignores a trucking association support of higher diesel taxes and taking new surplus money out of general revenue is “flawed.”

The governor just the other day said he considered a proposal to increase gas taxes but said “this was not the right time.”

“To raise the gas tax now or any tax now and say we are going to have to offset that by a reduction in income taxes in a future session would not be well received by the Legislature or the Arkansas taxpayer,” Hutchinson said.

Nevertheless, there are some politicians, bureaucrats and tax-supported advocacy groups saying an increase in fuel taxes should be part of the overall highway funding formula, and that being “more efficient” with the tax dollars by using surplus revenues more wisely isn’t altogether true.

While the Arkansas Trucking Association supported raising the diesel tax, the Joint Budget Committee co-chairman, Rep. Lane Jean, R-Magnolia, said he wouldn’t vote for a diesel-tax increase because he’s heard from many truck drivers, particularly the independent operators, who are opposed to raising the tax.

The Governor’s Working Group on Highway Funding, had discussed a proposal that would raise Arkansas’ motor-fuel tax by 10 cents a gallon on its wholesale price, but the governor’s plan holds the line on motor fuel taxes.

Let us make clear that currently Arkansas’ gasoline tax is already 21.5 cents a gallon, and its diesel tax is 22.5 cents, also at wholesale. And, let’s point out that while this Arkansas Trucking Association has come out in support of higher diesel taxes that the additional tax would simply be passed on to their customers as well as every consumer in the state. It would be very unlikely that any major trucking company would be directly impacted by such an increase.

Let us also point out this is a Republican governor and a majority GOP Legislature, a combination that leaves Democratic leaders naturally in a minority position.

Senate Minority Leader Keith Ingram of West Memphis, said that while Hutchinson’s plan is a “good start,” more could be done. Ingram also pointed out the trucking association’s support of a tax and said , “It’s very rare that an industry supports a tax upon themselves.”

But, as we’ve already made clear, the major trucking companies will simply pass that extra cost on to their customers resulting in little to no impact on the bottom line of these major trucking companies.

It comes as no real surprise to hear Democratic leaders, such as House Minority Leader Michael John Gray of Augusta, say they are apprehensive but, being that this is a Republican controlled majority, chances of Hutchinson not getting what he wants is highly unlikely.