A Costly Holiday
If you’ve even driven by a gas station lately, much less filled up your tank, you know that gas prices are dangerously close to a dollar more per gallon than they were before the incursion into Iran.
That has put a pretty big bite into everyone’s budget. So much so, that politicians are floating ideas to make prospective voters happier.
One is to have government declare a “gas tax holiday”—meaning the gas tax would be suspended on a temporary basis, to make the per-gallon of gas cheaper for consumers. Great idea for consumers on the front end…but as always, there’s a catch.
The folks at the Committee for a Responsible Federal Budget published an analysis yesterday on the potential effects of a gas tax holiday. Yes, a little help for consumers now—but according to CRFB, the bill for that will come due in a big way.
Without any offsets, they estimate that a one-month gas tax holiday would cost $3.5 billion…while a six-month holiday would cost $21 billion…and a three-year holiday would cost a whopping $124 billion in lost revenue to already insolvent governmental budgets.
They say all that means the Highway Trust Fund…which is already facing insolvency in 2028…could wind up going broke as early as March of next year, more than a year sooner than anticipated.
Obviously, we live in a “gratification now” society; that’s why the nation’s consumer credit card debt keeps reaching new record high levels. And yes, I’d like to save a few dollars whenever I can.
But given the possible ramifications…that few dollars now may not be worth the exponentially higher cost later.
