Trump endorses 25-cent gas tax hike, lawmakers say
President Donald Trump endorsed the idea of a 25 cent-per-gallon gas tax increase at a meeting Wednesday with lawmakers, people who attended the session said — a move that could help pay for his big infrastructure plan but brought swift attacks from anti-tax conservatives.
Trump’s support came just two days after the White House released a long-awaited, $1.5 trillion infrastructure plan that didn’t endorse such a politically perilous increase, and less than two months after he signed a mammoth tax code overhaul that would have provided cover for lawmakers supporting it. The last president to hike the 18.4-cents-per-gallon federal gas tax was Bill Clinton in 1993, a year before Democrats lost both chambers of Congress in a crushing midterm defeat.
A 25-cent hike phased in over five years would generate an additional $375 billion over the next 10 years, according to the U.S. Chamber of Commerce, which backs the idea.
Sen. Tom Carper (D-Del.), one of several lawmakers of parties who attended the meeting, confirmed that Trump had indeed “offered his support for raising the gas and diesel tax by 25 cents a gallon and dedicating that money to improve our roads, highways, and bridges.”
Carper added that Trump “came back to the idea of a 25 cent increase several times throughout the meeting,” and that he “even offered to help provide the leadership necessary so that we could do something that has proven difficult in the past.”
Rep. Peter DeFazio (D-Ore.), the top Democrat on the House Transportation Committee, emerged from the meeting saying he was heartened by Trump’s words.
“He acknowledged that there needs to be more federal investment than is proposed in his plan — or not his plan; his staff’s plan,” DeFazio said. Trump’s infrastructure proposal Monday called for using just $200 billion in federal money, which the White House has said would all be offset by budget cuts.
A White House official refused to confirm the president’s comments in Wednesday’s meeting. But the official noted that Trump has previously said everything is on the table to achieve his infrastructure goals and that the gas tax “has its pros and cons, and that’s why the president is leading a thoughtful discussion on the right way to solve our nation’s infrastructure problems.”
But anti-tax conservative groups quickly came out swinging against hiking the taxes motorists pay at the pump.
“I’d hate to see a new tax siphon off 20 percent of the $1,000 tax reform bonuses back to the swamp this year,” said FreedomWorks President Adam Brandon in a statement issued within minutes after the news of Trump’s change of heart. Similar statements came from groups including Americans for Tax Reform and Americans for Prosperity.
“President Trump will not be fooled into following the Democrat play book,” Americans for Tax Reform President Grover Norquist said in a statement.
Support for raising the gasoline tax to pay for transportation projects crosses political boundaries, however. House Transportation Chairman Bill Shuster (R-Pa.) brought up the idea at a recent GOP retreat as one way of providing more federal money for infrastructure.
DeFazio has also long called for a gas tax hike, his most recent proposal involving an increase of about a penny a year for 30 years.
In Wednesday’s meeting, DeFazio said, he and Shuster “both made the point that we need really strong support from the White House” to push a gas tax increase forward. That’s especially true, DeFazio said he told Trump, because House Speaker Paul Ryan (R-Wis.) is “not interested” in considering it.
If Trump follows through, it could mean billions of dollars in new revenue for infrastructure and help solve the intractable problem of the Highway Trust Fund’s shrinking potency, which is due in part to increasing fuel economy and alternative-fuel vehicles that don’t pay gasoline taxes.
Shuster said Trump also “understands you’ve got to find a pay-for, you’ve got to fix” the Highway Trust Fund.
Raising the gas tax would only go so far by itself, because Highway Trust Fund money cannot go to waterways, broadband service, airports, veterans hospitals or any of the other broad array of project types that Trump’s infrastructure plan seeks to fund. But it could achieve more than many infrastructure supporters had expected of Trump’s plan — offering a sustainable funding source instead of a short-term shot in the arm.
Though DeFazio was heartened by Trump’s comments, he was critical of portions of the plan that give preferential treatment and a higher federal match for rural areas — even though some of those rural areas are in the Oregon Democrat’s district. He also said he wants to see previously enacted regulatory streamlining provisions fully implemented before Congress approves more.
Even Shuster said he had questions about the portion of the administration’s proposal that would favor states and local governments that plan to pay for most of an infrastructure project themselves.
“It doesn’t work for all the states,” Shuster said. “They’re looking for the federal government to do its part.”
Shuster said that lawmakers and Trump “didn’t put a timetable on” a package, though Shuster indicated that he hopes to finish legislation before the August recess.
“We’ve got plenty of time to do it. I don’t believe it’s that difficult,” Shuster said. “We can get something done in fairly short order.”
Andrew Restuccia contributed to this report.