Legislator: Internet sales tax could help fund road and bridge maintenance
by Ted Carter
Published: May 31,2013
At some time in the not-too-distant future, that book you buy from Amazon.com may help to provide the estimated $1 billion Mississippi needs to maintain its roads and bridges.
Rep. Robert Johnson III, a 20-year state legislator and chairman of the House Transportation Committee, said he wants a sales tax on Internet purchases to be among the options lawmakers consider for funding a growing backlog of road and bridge maintenance needs. He said his first preference is to replace the fixed 18 cents-a-gallon tax on motor fuels with a rate tied to either the price per gallon of motor fuel or to inflation. Outside of that, he is ready to pursue a cyber charge, he said.
Johnson said 40 percent of Mississippi’s major roads and 28 percent of its highways are in poor or mediocre condition. He also says 25 percent of bridges are structurally deficient or functionally obsolete. Estimates are the state would have t pay $500,000 to bring its highways and roads up to standard and a near equal amount to repair bridges to meet safety standards.
Johnson concedes the political difficulties he could encounter in a bid to alter the 18 cents rate that has been in place since 1987 under a tax structure intended to raise money for a greatly expanded highway system but not the upkeep of the system. “That is why we have a more than half a billion dollars in repairs needed for bridges and why our highways are full of ruts,” he said.
The long-standing tax rate has given Mississippi the distinction of having the 44th lowest gas tax in the nation, behind only Missouri (17.3 cents); Oklahoma (17 cents); South Carolina (16.8 cents); New Jersey (14.5 cents); Wyoming (14 cents); and Alaska (8 cents), the Mississippi Department of Transportation reports.
In the quarter century since enactment of the 18 cents a gallon tax, traffic volume on Mississippi roads has increased along with the weight of many vehicles and the loads carried by tractor-trailers, Johnson noted. At the same time, fuel efficient vehicles have cut into the volume of gasoline sold and federal dollars for transportation have become scarcer, he added.
He said he expects principal opposition to any change in the motor fuels tax would come from Gov. Phil Bryant and Lt. Gov. Tate Reeves. “I understand their reasoning” in resisting a move to force Mississippi motorists to pay more at the pump, he said.
But motorists are the ones using the roads and thus the fairest way is to have them pay, he added. “It’s the most equitable” compared to taxing someone who buys an item on the Internet.
The opposition of Mississippi’s leadership to a change in the fuel tax formula “flies in the face of being for economic development and improving the environment in which you want to attract business,” said Johnson, a Natchez Democrat who acknowledges he has often bucked the House Republican leadership but insists he has an effective working relationship with the likes of Speaker Philip Gunn and other GOP leaders.
Should politics block that fuel-tax route, Johnson said he will push the Internet sales tax option. “We can’t move forward unless we’re willing to invest in our future,” he said.
“If people are not inclined to raise that tax (on motor fuel), we have to look at the Internet,” he said.
“The bottom line is the we are 25 years overdue in making a change in the way we fund our highway system.”
Johnson said he would fashion legislation to allocate money from the cyber sales tax to road and bridge maintenance. He would be willing to sunset the legislation after 10 years to free the sales tax money for general fund use.
An attempt to initiate an Internet sale tax is likely to draw objections from Bryant, who has vowed to fight any new tax on Mississippians, even though the state’s bricks-and-mortar retailers say taxing cyber sales is the only way to create a fair and competitive marketplace.
Johnson failed in a late-session effort this year to raise the 18 cents motor fuels tax. The bill would have tacked on an amount equal to 6 percent of the wholesale price of gasoline, starting next January. The measure called for the increase above the 18 cents per gallon to be recalculated every six months.
Johnson’s bill died in the House Ways and Means Committee.
Also dying in committee was a measure authored by Sen. Joey Fillingane that would have tied taxes on casino payouts to the highway fund.
Mississippi’s three transportation commissioners – Mike Tagert, Dick Hall and Tom King – agree new transportation maintenance funding is needed, especially for the one out of four state bridges that have been designated structurally deficient.
Hall, a state legislator for many years before becoming Central District commissioner, has been the highest profile proponent of new maintenance money. Rep. Johnson sees him as a principal partner in the revenue raising effort.
“Dick Hall and myself have been like the lone voices in the wilderness on this issue,” Johnson said.
Hall said his hard push this past session for a change in gas tax policy gained some traction as shown by the Senate’s agreement to appoint an ad hoc committee to study possible road maintenance revenue sources. Sen. Willie Simmons, a Cleveland Democrat who chairs the Senate Highways and Transportation Committee, will head the committee that will be made up of stakeholders such as local government officials and representatives of the state’s manufacturing, trucking and agricultural sectors.
It’s critical, said Hall, that something besides a set of recommendations that languish in the Legislature come out of the committee’s work.
“We’re losing ground,” he said.
Johnson said he thinks the study panel will recommend a statewide vote on increasing the gas tax, a move he would deem disappointing. “That’s the easy way out,” he said.
Johnson said he declined an invitation to serve on the committee. “I don’t believe in studying the questions that you already know the answers to,” he said.
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