CEO of Largest US Auto Retailer Calling for Ongoing Increases In Federal Gas Tax
5 October 2005
The Chairman and CEO of the US’ largest chain of car dealerships is calling for ongoing increases in the federal tax on gasoline in an effort to encourage conservation and alter buying patterns.
Mike Jackson, CEO of the $19-billion auto retailer AutoNation, is proposing an annual, open-ended increase of $0.10 per gallon.
After raising the issue at the Reuters Autos Summit in September (Reuters), he has subsequently written an editorial in this week’s edition of Automotive News and appeared on CNBC, campaigning for the policy.
In light of today’s high gasoline prices, if you mention that you support the idea of an increased gasoline tax, a lot of people will look at you as though you’ve been inhaling fumes. I believe that those who resist the idea are too close to “hi-test” for their own good. In fact, a gasoline tax hike is long overdue.
Since we all agree that America’s addiction to oil is an issue of national security, we need an energy policy that encourages conservation.—Jackson in Automotive News editorial
He is also proposing an annual energy-tax credit for low-income people to provide some buffer to the increase. The increases are necessary, he argues:
...to influence consumer behavior, create a significant demand for greater fuel efficiency and justify the costs of the technology that will deliver it. ... The goal of this is not to raise taxes but to change the consumer mind-set.
[...] For the past 10 years, we’ve had what amounts to an irresponsible, unsustainable half-price sale on gasoline. That has meant little consumer demand for efficiency and greater consumer demand for supersized vehicles with supersized power plants.
Although in a clear minority, he is not alone in the auto industry.
Reuters notes that Tim Leuliette, CEO of Metaldyne, proposed a similar increase to usher in the era of hydrogen-powered cars. Leuliette thinks the current efforts on hydrogen are woefully inadequate, given the country’s addiction to oil. (Earlier post.)
Leuliette wants a $0.50 tax hike phased in between 2008 and 2012 to fund research, build infrastructure and pay for incentives to get the public to buy the new cars.
Republican congressional leaders have flatly rejected any talk of raising the federal gasoline tax to curb consumption. One aide to a senior Republican senator said “the idea is not a good one and not worth dignifying with a comment.”
“Republicans are against it and Democrats are against it—that doesn’t leave much to work with,” said Rep. Ed Markey, Democrat from Massachusetts.
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