How Much Do Users Pay for PA’s Roads?

The Governor has let the cat out of the bag, or maybe, more apropos, some of the air out of the tire, on a holistic transportation fix for the Commonwealth. Part will be a proposal to take away a cap on the Oil Company Franchise Tax, a tax that is levied upon gas at the wholesale level but presently applies to the first $1.25 of the wholesale price. Removing the cap to apply the tax to the entire wholesale price, and by one estimate reported in a newspaper article would generate $1.8 billion on top of the $1.3 billion currently collected with the cap.

That was but one recommendation made by the Governor’s Transportation Commission in 2011; others include paying more in fees and registrations but lessening the frequency at which driver’s licenses and auto registrations must be renewed.

Its not clear what lifting the Franchise Tax cap, license proposals, etc. will mean for the end user, the person filling their gas tank and traversing one of Pennsylvania’s roads. A recent study by the Tax Foundation shows that nationally gas taxes, tolls, and other user fees generated just a third of the spending on roads-the rest comes out of general revenues. According to their analysis Pennsylvania is right at the national average: 33%, ranking it 18th out of the 50 states. Outliers include Alaska, Wyoming, and the Dakotas generating 20% or less of road spending from "user fees" and Delaware, Florida, and New Jersey at 49% or more of road expenditure coming from gas taxes, tolls, and driver related charges. Another Foundation document shows that as of 2013 Pennsylvania has the 7th highest gasoline tax at 39.2 cents per gallon (Connecticut has the highest at 56.2 cents, Alaska the lowest at 8 cents).