Filed under: Domestic Policy, Economy, Freedom, Law, Politics, Regulation, Taxes | Tags: Expect More Taxes, Federal Tax Receipts Up 8.2%, It's Not Enough
Growth in the American economy has largely gone a’glimmering. More businesses are failing than are starting-up. Because the Federal Reserve has kept interest rates artificially low, the stock market has done well as business is able to borrow cheaply. So this is turning out to be a record year for federal tax revenue. Uncle Sam is doing well. Not well enough for the Obama Administration, however.
The Congressional Budget Office reports that the first seven months of fiscal 2014 are up 8.2 percent to $1.74 trillion, or $132 billion more than a year earlier. So, as night follows day, the Obama administration wants more money. Since Obama is promoting infrastructure (again) as the solution to unemployment, he wants more money from the gas tax. People are driving less (because they are unemployed?) and cars are more fuel-efficient, so naturally they need more money.
The Highway Revenue Act in 1956 mandated a tax of 3¢ per gallon of fuel. Then it was increased to 4¢. The 1982 Transportation Assistance Act boosted it to 9¢, with one cent going to a new Mass Transit Account to support public transport. President George H.W. Bush in 1990 in the Omnibus Budget Reconciliation Act got a rise to 14¢ — with 2.5¢ going to deficit reduction. President Clinton increased the gas tax to 18.4¢ — with all of the increase going to deficit reduction. The Taxpayer Relief Act of 1997 redirected the 1993 increase back to the highway trust fund. The CBO is advising 29¢ which is where it would be if adjusted for inflation. This is, however an election year, and congressmen aren’t going to want to be responsible for raising your taxes.
However, the Federal Government may be on the verge of lifting a long-standing ban an on the ability of states to charge tolls on Interstate highways. This proposal has been sent to Congress by the Obama administration would remove the prohibition for tolls on existing Interstate highways. Whatever the tax on cars and drivers, it’s way worse for truckers and diesel fuel. (See rising prices for food.)
So there we are. The federal government doesn’t have enough in the Highway Trust Fund to fix all the highways, and Congress has been moving in some money from the General Fund. Or perhaps you will get it all — a higher gas tax, tolls on the Interstates, and a tax on miles driven. Many states already have tolls on some state roads.
Individual income tax receipts are up 3.6% due to higher rates, payroll levies are up 12.2% and corporate income taxes have soared by 14.5% to $156 billion. If we are reminded that corporations don’t really pay taxes, but pass them through to consumers in higher prices for goods and services, it clarifies where the money is coming from.
We would all be a great deal happier if we believed that the government was spending taxpayer money efficiently and thriftily. The federal deficit is down from $488 billion to $301 billion, but it should be much lower five years after the “Great Recession” as Obama likes to call it, ended.