U.S. Chamber of Commerce to push Trump, Congress to raise federal gas tax to fund infrastructure

A gas pump nozzle. (REUTERS)
A gas pump nozzle. (REUTERS)

WASHINGTON — With President Donald Trump and Congress turning their attention to infrastructure in the coming weeks, the U.S. Chamber of Commerce is preparing for an uphill battle: a push to raise the federal gas tax by 25 cents per gallon to help pay for the initiative.

The proposal by the nation’s largest business lobby, which will be formally unveiled later this week, is part of a series of principles it will offer in a bid to help shape the debate over upgrading the nation’s roads, bridges, airports and other critical infrastructure.

Chamber president Thomas J. Donohue said his organization wants “to put our oar in the water” and acknowledged that it would be “a tough vote” to raise the gas tax for the first time since 1993. But he argued that support has been building in the business community and elsewhere.

“I’ve been pushing this for a long, long time, but now gangs of people are pushing it,” Donohue said in an interview in which he also said immigration reform would be critical to ensuring there is sufficient labor available for construction of public works projects.

An infrastructure bill was touted by Trump as a first-100-days priority — and one with potential for bipartisan support — but put on the back burner amid other bruising legislative battles over health care and taxes.

The White House has pledged to unveil its vision of a bill ahead of Trump’s State of the Union address later this month.

In private meetings, Trump has floated the idea of raising the federal gas tax by as much as 50 cents per gallon, but received a chilly reception from Republican lawmakers in particular. Still, aides say the idea of an increase hasn’t been completely taken off the table.

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As envisioned by the Chamber, the 25-cent increase would be applied both to the current taxes of 18.4 cents per gallon for gasoline and 24.4 cents per gallon for diesel fuel. The increased levy is estimated to raise more than $375 billion over the coming decade, according to Chamber staff.

That is significantly more than the White House has suggested the federal government should pump into an infrastructure initiative. Administration officials have said publicly for months that they believe that $200 billion in additional federal money could spur at least $800 billion more spending by state and local governments and the private sector.

In its last budget proposal, the White House said the federal government’s $200 billion share could be paid for with cuts in other programs.

Part of the federal funding would be used to reward states and localities that raise taxes or other revenue to fund infrastructure in their jurisdictions. The White House is also looking at grants for new projects in rural areas and money for “transformational” work such as plans to build tunnels for high-speed trains.

Donohue said he is hopeful that with Trump’s support, Congress can come up with a meaningful measure to address what the Chamber sees as a long-overdue priority.

“We just got a new tax bill for the first time in 31 years,” Donohue said. “We’re making some significant changes in regulatory reform. We’ve got a president — everybody’s got all their own views about him and what he stands for and all that — but the guy’s getting stuff done ... and he’s a builder. I think we can get some help here.”

Donohue said the Chamber also plans to offer ideas to encourage additional private investments in infrastructure projects, including expansion of existing federal loan programs. And he said the Chamber shares Trump’s goal of streamlining the permitting process for highways and other projects, including at the local level.

“It’s not worth spending the money to do this or the time if we don’t fix the permitting deal,” he said.

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In the interview, Donohue also sought to make the case for addressing immigration policy in a way that ensures there is sufficient labor to construct the array of new projects that could be funded. That includes “a fix” to the Deferred Action for Childhood Arrivals program that Trump has canceled, Donohue said.

“We don’t need this the day we do a bill,” Donohue said of immigration reform more broadly. “We need it as we ramp up to start building the stuff we’re talking about.”

The Chamber also plans to call for other steps to enhance the workforce, including advancing recommendations on apprenticeships developed by a Labor Department task force.

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