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Rep. Tom Rice (R-S.C.) this week introduced the "Highway Trust Fund Certainty Act," legislation that would increase the federal motor fuels tax and provide an income tax credit to offset the cost of the increase to the average tax payer. Rice is a self- proclaimed conservative and his support for the motor fuels tax increase is significant. In a letter to other House members urging support for the bill Rep. Rice said, "As Congress has debated the Highway Trust Fund insolvency, two things have become clear: a user-fee system is the most reasonable and reliable, and there are no "silver bullet" revenue streams available."
The specifics of his proposal are as follows:
- Motor fuels taxes (gasoline and diesel) increase 10.1 cents per gallon to increase HTF revenue approximately $17 billion
- The new motor fuels rate is indexed to 2014 CPI
- The bill raises $115 billion in additional revenue over the 6 year period 2016-2021 (minus $11 billion for 2015 shortfall)
- The bill raises $215 billion in additional revenue over the 10 year period 2016-2025
- A maximum income tax credit of $133 is available to individuals with an earned income up to $74,950
- The maximum income tax credit of $266 is available to joint filers with a combined earned income up to $149,900
- The income tax credit begins to phase out at a rate of 1 percent and terminates at an earned income of $88,250 for individuals and $176,500 for joint filers
- $11 billion is transferred into the HTF to cover the 2015 short fall and repaid to the Treasury from the additional revenue
- Both the motor fuels tax increase and income tax credit are permanent
AGC will work in support of Rep. Rice's initiative.
For more information, please contact Brian Deery at deeryb@agc.org or (703) 837-5319. Return to Top
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