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House Lawmakers Pass Gas Tax, Registration Fee Increase

Posted On February 17, 2017

By Mike Perleberg

(Indianapolis, Ind.) – A bill that would increase the gas tax and vehicle registration fees is motored through the Indiana House on Thursday.

House Bill 1002 was passed by the House yesterday with a 61-to-36 vote, largely along party lines. Each of southeastern Indiana’s three state representatives – Randy Frye (R-Greensburg), Randy Lyness (R-West Harrison, and Cindy Ziemke (R-Batesville) – voted for the bill. Ziemke is one of a number of legislators who signed Americans for Tax Reform’s taxpayer Protection Pledge to not raise taxes.

Seven Republicans decided to join all House Democrats in opposing the gas tax bill, which is now bound for the Senate.

The proposal would raise the gasoline tax by 10 center per gallon and create a new $15 per year vehicle registration fee all in an effort to raise about $1 billion annually for road and bridge improvements. Every cent of the gas tax would be dedicated to roads, the legislation stipulates.

The bill would also give the governor the ability to implement tolling without the approval of state lawmakers.

State Rep. Ed Soliday (R-Valparaiso), the chairman of the House Roads and Transportation Committee, wrote the bill. He says that Indiana needs on average more than an additional $1.2 billion annually to maintain and improve roads and bridges.

House Republicans have been known more for passing tax cuts, not tax increases, in recent years. Speaker Brian Bosma (R-Indianapolis) believes Hoosier drivers and businesses recognize the critical need for road improvements. He called HB 1002 a conservative plan.

“Reps. Ed Soliday and Tim Brown have worked hard on this legislation, which is centered on data-driven and responsible solutions,” said Bosma. “Today’s passage of House Bill 1002 marks an important step and is the culmination of a 6-year long process of determining our funding needs and the best options to meet those needs.”

House Democrats shared their plan for road and bridge funding this week, but it was promptly rejected by Republicans, who enjoy a supermajority in the House.

Minority Leader Scott Pelath (D-Michigan City) says the plan approved Thursday would raise taxes on virtually every Hoosier except for the “very elite”.

“If the Republicans can come to their senses on that idea, then they certainly can realize that we can improve our roads and bridges without raising a tax on Hoosiers,” said Pelath in a statement.

“As this bill moves over to the Indiana Senate, I am hopeful that negotiations and careful deliberations about the long-term impact of this legislation will continue. There is a path to follow. All it takes is the kind of courage that recognizes you do not have to inflict the largest tax increase in state history on the people who can least afford it.”

Evidenced by the seven Republicans who crossed party lines on HB 10002, some conservatives also oppose the tax increase and are asking state lawmakers to look elsewhere to cut expenses before raising taxes. Americans for Tax Reform wrote a letter to members of the legislature in January.

“Your constituents have been hit with over 20 federal tax increases over the last eight years. The last thing individuals, families, and employers across Indiana need is to have lawmakers in the Indianapolis pile on with further tax hikes at the state level,” wrote Grover Norquist, president of Americans for Tax Reform.

Norquist suggests that legislators should immediately and permanently codify the earmarking of gas tax revenue to new and existing transportation projects.

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