Implications of Inflation-Adjusted Fuel Taxes on Government Revenue

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IU Public Policy Institute

One potential source for increasing funding for the surface transportation system is to increase gasoline and diesel taxes. As part of a project with the Soy Transportation Coalition, this report outlines the results of an analysis using a model in which fuel taxes are reduced by one cent from the present unit tax in each of 12 states studied and then links fuel taxes to projected inflation. The authors also evaluate the possibility of raising revenue through an annual special registration fee on newly sold battery electric vehicles, plug-in hybrid vehicles, and conventional hybrids.

Economic development, Tax and finance
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