Jay Evensen
  • Front Page
  • Opinions
  • Second Thoughts
  • Portfolio
  • Awards
  • About

What happened to Biden's lower gas prices from releasing all that oil?

12/9/2021

0 Comments

 
How are you planning to spend your gasoline surplus? You know, the money you saved because President Joe Biden released 50 million gallons of the nation’s strategic oil reserve in order to reduce the price we pay at the pump. 
I’m joking, of course. As I predicted, a release of the reserves barely moved the meter. It was a political stunt, nothing more.
The gas station monitoring website gasbuddy.com said the cheapest place in Salt Lake County earlier this week was $3.43 per gallon for regular gas, which is not far from where it was the day before Biden’s announcement.
Nationally, prices have come down slightly from an average of $3.41 per gallon a month ago to $3.33 this week, according to AAA. But experts had been predicting a drop due to natural economic forces, such as a reduction in driving during winter months and fears over the omicron variant of COVID-19. 
Do you want to see a real reduction at the pump? Get your state politicians to cancel the gas tax altogether. 
That’s what Florida Gov. Ron DeSantis is proposing for his state. It would cost about $1 billion per year in lost revenue, but Florida is one of several states sitting atop mountains of surplus money right now, putting it in a position to do something a little rash.
That list of states with surpluses includes Utah. As Gov. Spencer Cox unveiled his proposed budget this week for next year, he put the expected surplus in tax collections for ongoing funds at $1.16 billion, and the surplus for one-time money at $1.87 billion.
In the context of a $25 billion overall budget, that’s real money.
As he left a meeting with the Deseret News/KSL editorial board on Monday, I asked Cox what he thought of DeSantis’ plan in Florida. Without commenting directly on it, he said Utah has to get serious about what it wants to do with its gas tax, which is becoming increasingly ineffective each year.
It was designed as a user tax to fund road construction and maintenance, but it’s losing its punch.
Utah adds about 31.4 cents in taxes to every gallon of gas sold, but cars are becoming increasingly fuel efficient, and even though only 3.4% of all new cars purchased nationwide this year were hybrids, a recent survey by CarMax found 55.9% of Americans saying their next car purchase is likely to be an all-electric or hybrid model.
The future could be coming at us faster than a driverless Tesla.
Owners of those new cars won’t pay as much in gas taxes as their gas guzzling peers, but they still will cause wear and tear on the roads.
Utah has a pilot program allowing those folks to pay a tax based on miles driven, instead of paying heftier fees to register their cars. A simple device that plugs into a car’s data port keeps track.
Maybe everyone will have one of those some day. Or maybe we’ll see more aggressive tolling on roadways, with drivers charged more during high-traffic times. The state’s HOV lanes already use that model.
The gas tax problem wasn’t a part of the governor’s budget presentation, but Cox said he and legislative leaders have been talking a lot about it.
Frankly, this isn’t the time to eliminate the gas tax. To be meaningful, tax cuts should increase economic output. Making gas cheaper wouldn’t do that. Meanwhile, the tax still raises enough meaningful revenue, especially from out-of-state drivers, to serve a purpose.
But the state will have to face the future of road taxes sometime soon, perhaps sooner than politicians think.
With surpluses expected, the 2022 legislative session could feature huge debates about tax cuts of all sorts. Cox wants to enact a credit for grocery sales taxes paid. Others want to eliminate the state’s sales tax on food altogether, while still others want to cut the state income tax.
Debates like these will happen all over the land next year. Minnesota has a whopping $7.7 billion surplus. Arkansas may cut income taxes while providing tax breaks to a steel mill so it doesn’t move to Mississippi. 
Utah just lost the production of “Yellowstone,” a major television show, to Montana, and some lawmakers are talking about increasing the tax breaks to production studios. 
We weren’t expecting to be in this situation when the pandemic began. The only questions are why it’s here and how long it will last.
As Carl Davis of the Institute on Taxation and Economic Policy told Forbes recently, “... this rosy budget picture isn’t going to last forever.” However, he said, a lot of the tax cuts states are talking about “were written to last forever.”
So, enjoy your Biden oil reserve benefit while you can. Buy a small drink with your next fill-up.
Or maybe put the extra change away for the day when fortunes turn and taxes rise again.
0 Comments

Your comment will be posted after it is approved.


Leave a Reply.

    RSS Feed

    Search this site


    Like what you read here?

      Please subscribe below, and we'll let you know when there is a new opinion.

    Enter your email address:

    Delivered by FeedBurner

    Picture

    The author

    Jay Evensen is the Senior Editorial Columnist of the Deseret News. He has nearly 40 years experience as a reporter, editor and editorial writer in Oklahoma, New York City, Las Vegas and Salt Lake City. He also has been an adjunct journalism professor at Brigham Young and Weber State universities.

    Archives

    March 2023
    February 2023
    January 2023
    December 2022
    November 2022
    October 2022
    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    December 2014
    November 2014
    October 2014
    September 2014
    August 2014
    July 2014
    June 2014
    May 2014
    April 2014
    March 2014
    February 2014
    January 2014
    December 2013
    November 2013
    October 2013
    September 2013
    August 2013
    July 2013
    June 2013
    May 2013
    April 2013
    March 2013
    February 2013
    January 2013
    December 2012
    November 2012
    October 2012
    September 2012
    August 2012
    July 2012
    June 2012

    Categories

    All
    Campaign 2012
    Congress
    Crime
    Culture
    Iran
    Oil And Gas
    Poverty
    Steroids
    Taxes
    Utah
    Washington
    World Events
    World Events

    Links

    Deseret News
    Newslink
    Marianne Evensen's blog

Powered by Create your own unique website with customizable templates.