THE ECONOMICS OF THE DIESEL FUEL TAX DIFFERENTIAL

A 3 CENTS PER GALLON TAX DIFFERENTIAL WAS CONSISTENTLY PROPOSED BY THE KENNEDY AND JOHNSON ADMINISTRATIONS. BECAUSE THE DIESEL ENGINE CONSUMES LESS FUEL PER MILE THAN THE GASOLINE ENGINE DOES, THE DIFFERENTIAL WAS DESIGNED TO ELIMINATE THE APPARENT TAX ADVANTAGE GRANTED TO THE ECONOMIC DIESEL ENGINE. THE DETERMINATION OF THE 3-CENT DIFFERENTIAL IS BASED ON THE ESTIMATIONS OF HIGHWAY USE TAX RESPONSIBILITY MADE BY THE BUREAU OF PUBLIC ROADS. INCREMENTAL-COST ANALYSIS, ONE TECHNIQUE USED BY THE BUREAU, IS USED AS A MEANS TO ALLOCATE TAX RESPONSIBILITY ON A 'COST-OCCASIONED' BASIS, BUT APPLICATION OF THIS TECHNIQUE HAS CAUSED SERIOUS MISINTERPRETATION OF THE COST-OCCASIONED PRINCIPLE. HIGHWAY USER COSTS ARE ALLOCATED USUALLY ON A USE BASIS - EITHER AXLE-MILE OR VEHICLE-MILE TRAVELED. BUT BEFORE A DIESEL FUEL TAX DIFFERENTIAL IS DEFINITELY ADOPTED, ANY POSSIBLE OPPORTUNITIES FOR DISCRIMINATION AGAINST DIESEL VEHICLES MUST BE ELIMINATED. THE POSSIBLE ENCOURAGEMENT OF TAXPAYERS TO EVADE THE FUEL IMPOST IF ESTABLISHED AND THE NEW DEVELOPMENTS IN ENGINE TECHNOLOGY ARE SOME REASONS FOR THE NECESSITY OF DETAILED ANALYSIS OF THE APPLICATIONS OF A DIESEL FUEL TAX DIFFERENTIAL. /AUTHOR/

  • Digital Copy:
  • Supplemental Notes:
    • Paper sponsored by Committee on Highway Taxation and Finance and presented at the 48th Annual Meeting.
  • Authors:
    • Swartz, Thomas R
  • Discussers:
    • Meyer, W E
    • Buffington, Jesse L
    • Adkins, William G
    • Schafer, Dale L
    • RAKOWSKI, JAMES J
  • Publication Date: 1969

Media Info

  • Media Type: Print
  • Features: References; Tables;
  • Pagination: pp 47-68
  • Monograph Title: Transportation economics
  • Serial:

Subject/Index Terms

Filing Info

  • Accession Number: 00201716
  • Record Type: Publication
  • Files: TRIS, TRB
  • Created Date: Nov 24 1994 12:00AM