Senator Chuck Grassley“Republicans are trying to suggest things, but you wouldn’t think this administration would be against a user tax. They’re saying that’s a tax on low-income people? It probably is a regressive tax, but people don’t have to use it if they don’t want to”

Berkeley Economic Review: “The gas tax is a regressive tax that does hurt lower and middle-class households the most”

71% Of Voters Oppose Increasing The Gas Tax To Find Infrastructure Investments — Republican Voters Oppose it By A 74 Point Margin

WASHINGTON, D.C.  Today, a key Republican lawmaker admitted that Republicans’ proposed infrastructure pay-fors like punitive electric vehicle fees (EV fees) and a gas tax would burden the middle class instead of corporations that are shipping American jobs overseas.

Here’s what Senator Chuck Grassley said, explaining why the bipartisan deal was on the verge of collapse:

  • Sen. Grassley: “Republicans are trying to suggest things, but you wouldn’t think this administration would be against a user tax. They’re saying that’s a tax on low-income people? It probably is a regressive tax, but people don’t have to use it if they don’t want to.”

Zac Petkanas, senior advisor to Invest in America Action, made the following statement: 

“From day one, President Biden has made it clear that any infrastructure proposal raising taxes on the middle class is a non-starter. However, Republicans’ continued insistence on shifting the tax burden from corporations to the middle class is further evidence that they were never serious about finding a bipartisan deal to begin with. 

“They’d rather tax the minimum wage worker at an Amazon warehouse than the billionaire who owns the company. They’d rather Tesla drivers pay for our roads instead of billionaires like Elon Musk. But we can’t build a sustainable, equitable economy on the backs of working people while letting big corporations and the ultra-rich skip out on paying their fair share. 

“By making unreasonable demands that hurt working people, Republicans are essentially tanking any chance of a bipartisan deal and leaving the president and Congressional leadership no choice but to move on to reconciliation.” 

Gas taxes disproportionately hurt low and middle income Americans, and are highly unpopular with voters.

  • Berkeley Economic Review: “The gas tax is a regressive tax that does hurt lower and middle-class households the most… The tax increases the cost of gas… which is almost impossible for low-income households to tackle without serious sacrifice.”
  • Institute on Taxation and Economic Policy : “While gas taxes are important revenue sources, they’re also regressive — meaning that they require low-income families to pay more of their income in tax than wealthy drivers.”
  • Matthew Gardner, Executive Director of the Institute on Taxation and Economic Policy: “Low-income families don’t have the same ability to pay [user fees]. The $20 you use to register your car is going to be a much bigger deal for a family below the poverty line.”
  • 71% of voters, including 73% of Independents and 84% of Republicans, oppose increasing the gas tax to find infrastructure investments by up to a 74 point margin. 

Fees on electric vehicles would discourage their adoption and hurt U.S. manufacturing. 

  • An annual $100 registration fee for electric vehicles and hybrids could slow adoption of the vehicles by as much as 20 percent over the first few years.
  • Even if Congress imposed an annual fee of $100 on all light-duty electric vehicles starting in October of 2021, the revenues generated would only total $1.1 billion over 5 years.
  • The electric vehicle industry is poised to create 1.9 million jobs., but the U.S. first needs to stimulate the market. Unfair EV fees will only suppress the local market, punish innovation, and turn off investors and potential employers.
  • Center for American Progress: “U.S. public and private sector investment in EVs lags behind that of other countries, especially China, threatening both the United States’ ability to reach climate goals and the long-term competitiveness of the domestic auto industry,”
  • United Auto Workers: “China has increased demand from consumers by offering a variety of purchase subsidies, tax breaks, and in-kind benefits to EV buyers. China has also stimulated demand through government procurement policies that mandate a portion of vehicle purchases are EVs or hybrids. As a result, China is leveraging its position as the world’s largest automotive market and leading the world’s largest automakers to orient their EV strategies towards China.”