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MIT: Fuel tax does more to curb use, emissions and price than mpg standards

fuel graphIf the U.S. were serious about a reduction in fuel consumption and reducing harmful emissions, it would raise the gas tax that consumers pay at the pump rather than tightening efficiency standards for cars and trucks, says MIT researcher Valerie Karplus. 

In the March issue of MIT publication Energy Economics, Karplus has running a study comparing vehicle efficiency standards and the fuel tax, concluding that vehicle efficiency standards are more costly to consumers and the fuel tax is a better way to achieve a reduction in fuel use during the next few decades. 

Her reasoning is simple: Higher pump prices offer more of a direct incentive to drive less and invest more in efficient vehicles, whereas consumers won’t feel the sting of efficiency standards until they buy a car.

“A tax on gasoline has proven to be a nonstarter for many decades in the U.S., and I think one of the reasons is that it would be very visible to consumers every time they go to fill up their cars,” Karplus says. “With a vehicle efficiency standard, your costs won’t increase unless you buy a new car, and even better than that, policymakers will tell you you’re actually saving money.” 

Efficiency standards instituted last year were said to be a way to cut vehicle emissions in half and save consumers more than $1.7 trillion at the pump, says MIT. Karplus, however, says that she and her colleagues concluded that efficiency standards won’t reduce emissions as quickly as gasoline tax and that the standard will do nothing to impact the 230 million vehicles currently in use.

Karplus’ report does not mention trucks, though it’s assumed the same logic can be applied. 

The fuel tax has been a subject of concern lately for federal lawmakers, as fuel efficient vehicles have greatly dented revenue gained from fuel taxes, which are the main source of funding for the Highway Trust Fund. 

To make up for the loss, several lawmakers have proposed taxing vehicle miles traveled, similar to programs states like Oregon have in place already.

Karplus made her case in an op-ed piece in The New York Times last week. Click here to see it.

Gordon A
Gordon A

All this tax will do is increase the cost of moving the goods across the country and it will eventually put many, far too many truckers out of business. Why.? Easy, the rates will not be able to off set  the cost of the tax and the profit margin many owner operator have will disappear.  One thing that the govt and these MIT people just don't have is common sense. Are they  wanting  to tax All diesel or just highway diesel for trucks?. CARB is an example of stupid at work. Look who came up with the figures and then lied about his credentials.  Still CARB is using his  figures and he is still working there at a high rate of pay. Revenue enhancement is the only reason for many of the regs now on the books . It is why skirting is on 53 foot trailers . low resistance tires . 

When in the early to mid 70's  many steel haulers from Michigan & Indiana used gas powered trucks to run doubles from Mich to Il . It saved them lot of money that stayed in their pocket. Then came a new tax levied  on their gas due to being a commercial vehicle and the profit went down hill.

History is repeating it's self again. TAX  is a tax no matter how it is implemented or arrived at. This does not sound like reduced spending to me. 

timbo anti-castro
timbo anti-castro

Whether it is a tax on fuel or a tax on vehicles through higher emissions requirements(requirements =more expensive vehicles), the net result is more burdensome duty on the economy.  While he is right about taxing people out of their ability to drive(and consume gallons), he does not really believe in the freedom to be able to do so.  Big government advocates likes these people from MIT are obviously incapable of recognizing the cripling effect of the green movement on commerce.  Emmissions measures are nice and kind but pretty soon, these climate change advocates are going to run out of tax revenue to subsidize their uneconomical mandates.  Remember, please, that man-made global warming is still just a theory and I find it rather disturbing that our society is willing to crush free market economics to appease ignorant popular will.  Remember also that the only economies that care about cleaner emmissions are the economies that got rich from mostly free market economics(CAPITALISM).  The golden goose is capitalism and the efforts of idiot college professors should be focused on growing free markets.