Tax on "big oil" is just passing gas

The following is from the Wisconsin Club for Growth Wednesday newsletter. I thought it a timely reminder of the stakes regarding the proposed tax on "big oil", a tax even Democrats now concede will be passed along to the consumer.

Passing Gas

For the second straight budget, Governor Jim Doyle included a 2.5% tax on oil companies which he claims won't be passed on to drivers at the pump. But studies have shown that one way or another, the increased cost to oil companies will be paid by consumers.

Of course, every company passes along tax increases to consumers, making their goods more expensive. Doyle's proposal would add between five and eight cents to a gallon of gas at the same time prices are nearing $3.00 per gallon.

Representative Robin Vos, a member of the Legislative Joint Finance Committee, pointed out that if the new tax is applied on a percentage basis, the tax will increase as the price of gas goes up. The current gas tax is a flat per gallon fee. In this regard, the oil franchise fee approximates the old gas tax indexing system, where gas taxes increased automatically every year without legislative action. The legislature repealed the indexing system in 2005 after Governor Doyle repeatedly raided the transportation fund to pay for other programs, at the same time he increased debt to pay for transportation projects.

At Vos’ request the Legislative Fiscal Bureau prepared a memo detailing the cost of the new tax to consumers. At $2.50 per gallon, the gas tax is expected to increase the per gallon cost by 4.9 cents. But if gas prices reach their 2008 summer levels of $4.00 per gallon, the state will tack on 8.7 cents to every gallon of gas.

Of course, legislative liberals still claim that their budget doesn't raise taxes on people in the middle class, like those wealthy people who fill up their cars to drive their kids to school and swimming lessons.

The Assembly will have an opportunity to remove the new tax when they vote on the budget Thursday, so be sure to contact your legislators today.

Governor Doyle gives me gas

Governor Doyle's tax on "big oil" profits is not likely to pass the legislature. (Will any Democrats apologize to State Representative Bill Kramer now that they are the tools of Big Oil, too?) So the usual suspects are going back to their favorite revenue source: raising taxes directly at the gas pump.

Gov. Jim Doyle said Monday he’s open to a 3-cent gasoline tax increase as an alternative to his proposed tax on oil company sales.

Doyle said he preferred his plan to pay for roads by raising taxes on oil companies by $272 million over two years and barring the firms from passing the tax on to consumers.

But some business groups have instead been pushing an increase to the state’s gas tax — currently the second highest in the nation — saying it wouldn’t face the oil tax’s potential legal challenges.

"I give them credit. They’ve really worked to come up with a proposal, and I think it’s one that’s worthy of consideration," Doyle said.

The plan by groups representing oil companies, grocers, car dealers and convenience stores would include $306 million in new money over two years for the state’s road fund through the gas tax hike and new fees.

As the Wisconsin State Journal reports, Wisconsin already has one of the highest gas taxes in the country. That high tax has allowed Governor Doyle and the legislature to raid the transportation fund for nearly $1.3 billion, far more than this new tax would raise. If the governor and the legislature could keep their hands off the transportation fund, we could actually cut the gas tax and vehicle fees, not raise them.

The new taxes and fees, according to the Wisconsin State Journal:

• Raise $170 million from the gas tax.

• Raise $61 million by increasing the fee for car titles to $78 from $53.

• Raise $15 million by putting a $50 annual surcharge on hybrid vehicles.

• Use $42 million already in an environmental cleanup fund.

Nice to see the "environmental cleanup fund" is just a slush fund along with the rest of the transportation budget.

Doesn't he do radio?

Update! I was right. He does do radio. (see comments)

This must be a joke, right?

Check out the picture before you read the article, then tell me if this is a joke. For Some Ohioans, Even Meat Is Out Of Reach