Home » OPINION » Columns » ANALYSIS — Tax hike is one thing, bright outlook for gasoline is another

ANALYSIS — Tax hike is one thing, bright outlook for gasoline is another


A hike in Mississippi gasoline tax has been bandied about for years as a solution for much-needed improvements in the state’s roads and bridges.

But it continues to draw, at best, a luke-warm response from governmental leaders.

Whether the increase were to occur, the good news is that the historical price of gasoline in the state continues to be low.

The Mississippi gasoline tax stands at 18.4 cents per gallon, unchanged since 1987, when it was imposed by the Legislature. It is the lowest among its neighboring states and 48th in the nation, according to the Tax Foundation.

The tax established “1987 Highway Program,” a $1.6 billion long-range bill calling for the construction of over 1,000 miles of four-lane highways.

A gallon of regular in 1987 cost 69 cents in Mississippi. That is the inflation-adjusted equivalent of 99 cents in 2019 dollars, far below current prices.

Gasoline prices in Jackson going back 10 years is $2.56, compared with $2.69 nationally.

The relatively low price would seem to enhance the chances of raising the tax to pay for the miserable condition of so many roads and bridges in Mississippi.

There are other sources – Internet sales taxes, lottery revenue and sports gambling revenue.

A report from the  Joint Legislative Committee on Performance Evaluation and Expenditure Review, or PEER, stated that the current gasoline tax yields about $300 million annually.

The Mississippi Economic Council, the state chamber of commerce, holds to its position of several years that the minimum needed for maintenance of the state’s roads and bridges is $375 million.

MEC Executive Director Scott Waller said in a recent interview that a one-cent hike in the gasoline tax, for example, would raise $20 million per year.

First-term Gov. Tate Reeves is dead set against increasing the tax.

Returning Speaker of the House Phillip Gunn has in the past proposed a swap of a break in income tax for a hike in the gas tax, though he subsequently seemed to back off of that position.

Delbert Hosemann, the former secretary of state who was just installed as lieutenant governor, which puts him in charge of the Senate, has suggested allowing local governments to add a tax onto the state levy, with a “sunset” provision that would allow repealing the add-on.

Committing to a tax increase on something whose basis could change substantially in the  future is something that gives pause.

The revolution in oil and natural gas production in the United States through hydraulic fracturing, or fracking, has encountered opposition on environmental concerns, but production has continued to grow, though at a slower rate, according to the federal Energy Information Administration.

In fact, the United States stands to be a net oil exporter in 2020, meaning that it has more control over the price of crude oil – and thus gasoline prices, the EIA states.


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About Jack Weatherly