New Castle News

January 31, 2013

Our Opinion: Transportation plan obviously increases consumer costs

By Staff
New Castle News

NEW CASTLE — Whenever politicians make broad, blanket pledges, they often run the risk of making themselves look foolish.

And so it is with Gov. Tom Corbett, who once again is faced with the prospect of trying to explain how a tax increase is nothing of the sort.

You may recall that when he ran for governor, Corbett made the standard Republican promise not to raise taxes while in office. Since that time, he has supported the imposition of a fee on shale gas extraction in the commonwealth and authorized a new line on state income tax returns seeking payment of previously uncollected use tax.

Now comes an increase in gasoline taxes. Only don’t expect the governor to call it that.

News reports indicate that a major part of Corbett’s upcoming plan to upgrade transportation maintenance funding in the commonwealth will involve a change in Pennsylvania’s oil franchise tax. The move — which will require legislative approval — involves lifting a current cap on the tax.

The effect of this move would mean higher taxes for gasoline stations — to the tune of nearly $2 billion a year.

When Corbett floated this idea a few months back, he argued that lifting the cap wouldn’t necessarily lead to higher prices at the pump, because a variety of factors impact gasoline prices.

That’s true, but the same could be said of any consumer product. Does that mean government can boost taxes on them and then claim it did nothing of the sort?

Apparently so in Harrisburg, where Corbett’s press secretary, Kevin Harley, denied the plan would boost taxes. “How is he raising taxes?” Harley asked an Associated Press reporter wanting information on the subject. “I am curious how he is raising taxes.”

Well, we’re curious about how this can be anything other than a tax increase.

If oil companies have to pay Pennsylvania an additional $2 billion a year, we think it’s a safe assumption that the money will be tacked on to gasoline prices. Any argument to the contrary strikes us as ludicrous.

Be that as it may, it appears Corbett’s plan will receive widespread support in the Legislature, where lawmakers in both parties have been clamoring for more transportation funding. Democrats will accept the new tax, while winking and nudging at Corbett’s inconsistency. Republicans will seek to avoid the subject.

There is no doubt that roads and bridges in Pennsylvania need work, and that means they need money. Obtaining those funds from gasoline makes sense in terms of it being the equivalent of a user fee.

However, we hope that Corbett’s upcoming announcement on transportation funding comes with renewed state efforts at efficient, responsible spending. Pennsylvanians already shell out billions of dollars for state highways. The money needs to be used wisely.