The ongoing revenue generated from this tax is earmarked for critical needs, including funding for the Statewide Flood-Control Program. Additionally, the proposed legislation allows portions of the tax revenue to be used for securing bonds or other financial instruments, which may further enhance funding for infrastructure projects. This is expected to improve state roadways and flood defenses, areas that have seen increasing demand for attention given recent environmental challenges.
Summary
House Bill 659 is designed to levy an additional tax of 9¢ per net gallon on gasoline, diesel, and special fuels sold in Louisiana for domestic consumption. This tax is intended to generate revenue for state infrastructure initiatives, particularly in the realm of transportation. The legislation also outlines provisions for a potential future increase of this tax to 17¢ per gallon on January 1, 2022, contingent upon the Department of Transportation and Development (DOTD) meeting specific compliance criteria as assessed in ongoing audits.
Sentiment
Overall, the sentiment surrounding HB 659 appears cautiously optimistic, particularly from proponents who highlight the necessity of maintaining and improving Louisiana’s aging infrastructure. Nonetheless, there are concerns from various community stakeholders about the burdens that additional taxes may place on consumers, especially in a state where fuel prices are already a significant consideration for many families. Legislative discussions indicate a recognition of the balance needed between infrastructure funding and potential financial implications for citizens.
Contention
Noteworthy points of contention include the potential impact of tax increases on low and middle-income households, as these groups may feel the strain of higher fuel costs more acutely than others. While support largely comes from those acknowledging the dire need for infrastructure improvements, opponents argue that imposing additional taxes could exacerbate existing economic strains. The bill thus invites a broader discourse on how best to finance public goods while considering the economic realities of the state's residents.
Creates an additional tax on motor fuels and requires the tax on gasoline, diesel fuels, and special fuels to be adjusted annually in accordance with the Consumer Price Index (EG +$551,600,000 SD RV See Note)
Increases the per gallon excise tax on gasoline, diesel, and certain special fuels and levies an excise tax on electric and hybrid vehicles (OR -$305,000,000 GF RV See Note)
Adjusts the amount of excise tax levied on gasoline, diesel, and special fuels and levies new taxes on gasoline, diesel, special fuels, and electric and hybrid vehicles (EG INCREASE SD RV See Note)
Dedicates a portion of the existing tax levied on gasoline and diesel into the Construction Subfund and imposes a one-time road-use fee on electric and hybrid vehicles (RE SEE FISC NOTE GF EX See Note)
(Constitutional Amendment) Provides relative to the deposit and use of the avails of the taxes levied on gasoline, motor fuels, and special fuels (OR SEE FISC NOTE SD EX)