Koch groups urge Trump to oppose gas tax increase

Koch groups urge Trump to oppose gas tax increase
© Getty Images

Groups backed by wealthy GOP donors Charles and David Koch are urging President TrumpDonald John TrumpDems make history, and other takeaways from Tuesday's primaries Pawlenty loses comeback bid in Minnesota Establishment-backed Vukmir wins Wisconsin GOP Senate primary MORE to oppose an increase in the federal gas tax, as the administration plans to push an infrastructure package this year.

"Increasing the federal gas tax to fund new infrastructure projects would be the wrong approach," Americans for Prosperity and Freedom Partners said in a letter to Trump dated Tuesday.

"Not only would it undermine the benefits of recent tax-cut legislation, it would disproportionately hurt the least fortunate — who pay a higher percentage of their income in energy costs — and lead to higher prices on goods and services throughout the economy," the groups added.

The White House and lawmakers have expressed an interest in working on legislation this year to boost infrastructure investment, but the challenge is figuring out how to pay for such a package.

ADVERTISEMENT

One option could be an increase in the 18.4-cent federal gas tax, which hasn't been raised since the 1990s and isn't indexed to inflation. The U.S. Chamber of Commerce is pushing for a 25-cent increase in the tax over five years.

Americans for Prosperity and Freedom Partners criticized the Chamber's proposal, saying that it would lead households to spend an additional $285 on gas on average annually. The groups argued that a gas tax hike would effectively claw back about 25 percent of the benefits from the new tax law for low- and middle-income Americans.

“Efforts to improve our nation’s infrastructure should focus on maximizing taxpayer dollars by targeting priorities such as roads and bridges, eliminating wasteful spending, removing regulatory barriers that delay projects and drive up costs, and ensuring there is proper oversight and accountability,” the groups said.

The Chamber, in a statement to The Hill, defended their call to raise the gas tax.

“We put forward a plan that would allow America to invest the hundreds of billions of dollars that are needed to rebuild and modernize our infrastructure," said Neil Bradley, executive vice president and chief policy officer at the U.S. Chamber of Commerce.

"We’re ready to work with anyone who is willing to get this done and we welcome alternative ideas to fund that investment, but let’s be clear, America won’t move ahead if we are trying to rebuild and modernize on the cheap."

A draft of the White House infrastructure plan that leaked earlier this week did not call for a gas-tax increase. The Koch-backed groups said they were "encouraged" by this development.

This story was updated at 12:15 p.m.