Saturday, April 18, 2009

Gas tax to increase in Michigan soon? (Side title - we're broke despite revenue increases)

This isn't the first time this issue has come up. The Lansing elite has been trying to shove this down our throats for years. The Gas Tax. Both parties haven't been great on this.

2007 - Hopgood and DeRoche push for gas tax

The usually sensible Michigan Chamber of Commerce pushed it in 07

The Granholm tax force in 08

Late 08, again

Now one the more influential columnists in Lansing is trying to stir this up again.
Peter Luke, columnist of Booth Newspapers (Ann Arbor News) is pushing for a gas tax for the roads. It once again relies on the false assumptions. The assumption among the elite in Lansing is that "only the gas tax can pay for roads." That's the number one assumption of ALL these pushes for the gas tax. I don't buy that. Assumption is the mother of all eff ups.

Judging from the opposition to socialist tax schemes by those who traveled over Michigan's collectivist road system to the Lansing "tea party," it just got harder to pass business-backed funding increases for transportation.

Lawmakers this week are expected to begin work on a hike in fuel taxes, last raised in 1997, and vehicle registration fees, sending them to Gov. Jennifer Granholm by summer.

Is this that same 50% registration increase that the task force wanted? As far as gas prices go, are they going to go up to $4.50 a gallon this summer, again? Is sales tax going to be collected on this? Take the money from another department. We can start with Dan Mulhern's staff, that new state police building, and corrections be keeping people in jail for smoking a doobie. In addition, do you trust state government enough to make sure that goes to roads? Or will they starve the roads for a bigger tax increase while repeating this same assumption over and over and over and over and over again.

Without those increases, Michigan's road-repair budget will soon be broke. And yet, billions are needed to keep one of the nation's most decrepit road systems in reasonably good shape.

Assume. It makes an ass of u and me.. This premis is ONLY true if the assumption is true. It does not have to be. Roads should be priority funding. Right now 6% of every gallon of gas goes not to roads. That 6% is the state sales tax, which goes on top of the original gas tax. We are taxed twice over on gasoline.

Too bad the crowd at the Capitol on Wednesday loudly booed any mention of a gas-tax increase. And that the Michigan Republican Party hastened to endorse them.

"It's time to send a strong unified message that Michigan residents and job providers cannot afford another tax hike," GOP chairman Ron Weiser said.

Republicans intend to run next year against income and business tax increases approved in 2007, even though no Democrat was defeated in 2008 for voting for them. GOP co-chairwoman Sharon Wise said the 2007 hike -- which prevented steep cuts in higher education, health care and aid to local governments -- was "taken" from Michigan families.

The revenues keep increasing to the state, and what have we gotten from them. Jack and you know what. These are Granholm's numbers. Budget Book

(Fiscal year)
1999 - 32,653,492,611 (Amount Spent - and Michigan has balanced budget, so revenues are close to that number)
Transportation - 2,631,185,388

2000 - 34,525,326,492
Transportation - 2,660,470,554

2001 - 37,277,724,042
Transportation - 2,775,245,805

2002 - 39,077,762,617
Transportation - 2,857,404,627

(Granholm takes office)

2003 - 39,297,181,602
Transportation - 2,858,865,148

2004 - 39,388,261,316
Transportation - 2,957,280,073

2005 - 40,375,490,414
Transportation - 2,920,553,025

2006 - 41,326,338,653
Transportation - 2,940,680,294

2007 - 41,945,183,846
Transportation - 2,779,953,122

2008 - 43,578,704,400 (Tax increase)
Transportation - 3,360,195,600

2009 - 44,834,397,200 (Executive recommendation)
Transportation - 3,424,465,500 (executive recommendation)

This keeps going up DESPITE tens of thousands of people leaving the state.

The tax protesters conveniently neglected to mention that Michigan's 4.35 percent income-tax rate is lower than it was under most of Republican Gov. John Engler's 12 years in office. Nor is it a GOP talking point.

Under the 2007 increase, a household with $50,000 in taxable income paid about $225 more in 2008 than under the 3.9 percent rate. But that is $25 less than they would have paid in 1999.

I don't give a damn if it is less than Engler's term. Again, false comparison. Many states don't have an income tax or a property tax. We have both, and a sales tax, and the MBT, etc. Secondly, the gross revenues keep increasing year in and year out. $5 Billion dollars more - 1/2 of the amount budgeted as "general fund", is sent to Lansing, than it was at the end of the Engler years. Thanks to Headlee, Michigan can not operate without a balanced budget. The fact is that the Granholm admin gets much more money than Engler ever did.

If Republicans consider that thievery, then a proposed $1.4 billion increase in gas taxes and registration fees -- $150 per vehicle when it's phased in -- would take no less from a two-car household.

About $60 (with my six year old truck) more to the government in registration fees. Approxminately 9 cents more (based on previous proposals) per gallon every time I go to the pump. If the raw price of gas is $1.81/$3.81 here in Michigan, and this passes, the real cost will be.
Wholesale price - $1.81 (3.81)
US gas tax - 18.4 cents - $2.00, $4.00
Sales Tax (applies to US tax and price - $2.12, $4.24
Michigan gas tax - $2.31, $4.43
Michigan gas tax increase - $2.40, $4.52

Before the gas tax, it would cost me about $46.20 (or $88.60) per fill up (about 20 gallons). After - $48.00.(or $90). Now I included the $4+ gas prices here because I expect to see them again this summer. These energy prices were the final knockout punch IMO in this economy. People saw these every day and had to budget for them. This was an extra $40 every fillup that people did not plan for or expect. That money had to come from somewhere. That lead to inflation. Gasoline prices - obvious. Food costs went up. Shipping. Business costs went up - shipping. Household bills increased. It just amazes me that government and these pundits want an increase on the worst possible tax around, AND that they assume (the mother of all @#%# ups), that is the only possible solution. It reminds me that the 1.4 trillion dollar bank bailouts (there are two of them) are the ONLY possible solution according to Bush, Obama, McCain, and the rest of the Washington elite.

And so the GOP has put its lawmakers in a box.

Business, labor and elected officials in both parties agree basic stewardship requires finding the cash to fix Michigan's infrastructure. And economic stimulus money provides only a temporary boost, through the 2010 construction season.

But the Michigan Republican Party has cemented an anti-tax stance that appeals to its most conservative, tea-bag-waving elements. That makes it tough for radical outfits like the Michigan Chamber of Commerce to persuade GOP lawmakers to join Granholm and Democrats in raising transportation taxes.

Spare me, Pete. I like the Chamber, but they have a different agenda this time. You see, one of their constituents is the Road Builders who want more money for contracts. I don't fault the Chamber for that stance. They have to represent their members.

And unless Republicans do that, Democrats vilified for the 2007 income tax hike are not going to stick their necks out again. GOP lawmakers already edgy about the issue apparently have to choose between their party and the economic good of their state. It's a choice they should not have to make.

They don't have to make that choice. That's what you people in Lansing don't understand. This whole push for a gas tax increase is based on this false assumption that only gas tax money can go to roads, and that it is the only solution, etc.

I'll tell you what. I'll support a compromise because I do think roads funding is important. Here's the compromise. No registration fee increases, end the sales tax for gasoline, and then increase the gas tax by 10 cents (and I won't even complain if it is 12 cents in this case). ALL of that money goes to roads and only to roads - period. That results in no increased costs for us with $2 a gallon gas, or a slight increase possibly if it is 12 cents at $2. That's my compromise plan.

As for the plan of 9 cents a gallon increase, and the 50% registration increase, and the keeping the 6% sales tax on gasoline - get the recall petitions ready for those who vote for that. You can quote me on that.

1 comment:

bear said...

And even after all that, US127 will still be 55 through Clinton to Gratiot county.

Finish the freeway, end the speed traps.