After weeks of speculation, Governor O’Malley finally released his gas tax proposal. There’s a bipartisan backlash to his plan and it’s unclear whether it will pass the General Assembly. Here at MPPI, we’re doing our part to help educate the public about why a gas tax hike would be bad for the state.

The Maryland Reporter sums up the main part of the governor’s proposal pretty well:

… sales tax would be applied to the retail price of motor fuel, minus federal and state taxes.  So if the retail price of a gallon of gas is $3.49, then nearly 42 cents – 18.4 cents in federal taxes and 23.5 cents in state taxes – get subtracted. Then, the 6% sales tax is applied to the remaining $3.07 – making the new tax about 18.4 cents. Documents from O’Malley’s office say this will be an increase of about 6 cents per gallon a year.

I thought that it may be a good idea to gather all the research MPPI has put out on the gas tax here, as an easy reference guide for those who are troubled by the O’Malley proposal.

-- Christopher Summer’s op-ed “We Need to Put the Brake on O’Malley’s Gas Tax” and Marta Mossburg’s column “No to the Gas Tax” contain good succinct summaries of why the gas tax hike is bad policy.

-- For a far more detailed look at the flaws in the gas hike plan, there’s the policy report, “Rethinking Maryland’s Proposed Gas Tax Increase” by Ronald Utt and Wendell Cox. This is a fact-packed report that demonstrates with hard numbers exactly why this proposal isn’t good for the state’s taxpayers and why it won’t help the state’s transportation needs.

-- You may not have time to read a report on the gas tax, so MPPI also put together a “Myths and Facts on the Gas Tax Increase.” This shorter piece dispels the myths flying around Annapolis on why we need this tax hike.

-- A related report by Wendell Cox, “Transportation Policy in Maryland: Focus on Economic Performance,” touches on the gas tax issue within a wider discussion of transportation policy. This report will give you an education in what’s wrong with the way state policymakers approach transportation issues. Fixing these flawed policies would produce enough revenue to take care of the backlog of road and highway construction needs Maryland has.

In my opinion, there is certainly a backlog in transportation projects that Maryland needs to fund. As the research put out by MPPI shows, however, these projects can be funded without hiking the gas tax. Raising the gas tax would hurt Maryland’s economy and especially penalize poorer Marylanders. It’s bad policy that has been proposed to deal with the effects of the state’s flawed transportation policy.