Gas Tax Facts
(most of the inspiration and ideas on this topic come via Mankiw)
Here is why a gas tax makes more sense than legislating fuel efficiency requirements for cars. Making a super fuel efficient car is expensive. You might have to pay an extra $5000 for your car. This means that you're going to get the car only if you really mean to use it. And if the car is fuel efficient, you'll use it to death. That is, under fuel efficiency legislation,
Here is why a gas tax makes more sense than legislating fuel efficiency requirements for cars. Making a super fuel efficient car is expensive. You might have to pay an extra $5000 for your car. This means that you're going to get the car only if you really mean to use it. And if the car is fuel efficient, you'll use it to death. That is, under fuel efficiency legislation,
- Cars cost more.
- It costs less to drive them.
- People with cars drive more.
- Overall, there is very little reduction in fuel used.
posted by My Freakwentness at 6:03 AM
3 Comments:
it might also help pay for road infrastructure by the people who are actually using it.
What tax rate would be effective?
Mankiw proposes a tax rate of $1 per gallon. Parts of Europe already have much higher taxes.
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