CHEATING OUR STATE HIGHWAYS: METHODS, ESTIMATES AND POLICY IMPLICATIONS OF FUEL TAX EVASION

Motor fuels tax evasion is a persistent drain on state resources earmarked for public transportation systems. This study discusses fuel tax evasion issues in the context of the Kentucky Road Fund in comparison to peer states in the southern region. The prevalent methods of fuel tax fraud are identified and described. A basic model for estimating revenue loss from fuel tax evasion is also demonstrated for the Commonwealth of Kentucky. The model estimates that as much as $16 million in motor fuels tax revenue was evaded in 1998. The estimates of evasion are also discussed in the context of a proposed 10-cent tax hike on both gasoline and diesel fuels. Conservative estimates suggest that this tax change may increase fuel tax evasion by 38%, or an additional $6 million in lost revenues. The authors' findings serve to remind policymakers and administrators that enforcement efforts need to be stepped up when incentives to evade are altered.

• Record URL:
  https://hdl.handle.net/2027/mdp.39015047810828?urlappend=%3Bseq=261
• Availability:
  • Find a library where document is available. Order URL: http://worldcat.org/oclc/7938948
• Corporate Authors:

  Eno Transportation Foundation

  1250 I Street, NW, Suite 750
  Washington, DC  United States  20005
• Authors:
  • Denison, D V
  • Eger III, R J
  • Hackbart, M M
• Publication Date: 2000

Language

• English

Media Info

• Features: Figures; References; Tables;
• Pagination: p. 47-58
• Serial:
  • Transportation Quarterly
  • Volume: 54
  • Issue Number: 2
  • Publisher: Eno Transportation Foundation
  • ISSN: 0278-9434

Subject/Index Terms

• TRT Terms: Administrative and managerial personnel; Fraud; Fuel taxes; Highway transportation; Highway user taxation; Motor fuels; Policy making; Public transit; Revenues; State government; State taxation; Taxation; Transportation system management
• Uncontrolled Terms: Tax evasion
• Geographic Terms: Kentucky; United States
• Subject Areas: Administration and Management; Finance; Highways; Policy; Public Transportation; Security and Emergencies; I10: Economics and Administration;

Filing Info

• Accession Number: 00792584
• Record Type: Publication
• Files: TRIS, ATRI
• Created Date: May 12 2000 12:00AM