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HB 738: To change Missouri's fuel tax to a percentage of wholesale price | Missouri House of Representatives

Submitted by Brent Hugh on Sat, 04/18/2015 - 7:38am

Headlines are quick hits from media outlets from Missouri and around the world. Follow the headline link for the full story. The source of this headline says:

HB 738, sponsored by Rep. Dave Hinson, is an innovative solution to Missouri's transportation funding problem. Instead of a set fee per gallon, HB 738 changes the rate and computation of taxes on motor fuels to a percentage of the wholesale price; about 10% of wholesale price.

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HB 738: To change Missouri's fuel tax to a percentage of wholesale price | Missouri House of Representatives
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MoBikeFed comment: Some states have switched to the wholesale tax approach. One advantage of this approach is that tax rates naturally increase with inflation.

This overcomes one of the main disadvantages of the per-gallon fuel tax, that it naturally decreases in purchasing power every year as inflation increases.

Missourians are protected from overly large increases in the fuel tax rates because the the tax falls under the Hancock Amendment, which strictly limits annual increases in any tax.

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