US Republicans may reject a major proposal to pay for Trump's $1.5 trillion infrastructure project because it could ruin the goodwill from the tax law

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  • President Donald Trump rolled out a promise for a $US1.5 trillion infrastructure package during the State of the Union.
  • Republicans discussed paying for the federal portion of the plan with an increase in the federal gas tax, which hasn’t been boosted since 1993.
  • GOP leaders are concerned such a move would ruin some of the positive reaction they are seeing from the recently implemented tax law, according to Axios’ Jonathan Swan.

Republicans may shut down a major idea to fund President Donald Trump’s massive proposed infrastructure project in part because it could scuttle positive press from their tax law.

Axios’ Jonathan Swan reported that the GOP is wary of including gas-tax increase to any infrastructure package because it would appear as a tax increase targeted at the middle class.

The issue was discussed during the GOP’s retreat in White Sulphur Springs, West Virginia, according to Swan, with some members advocating for an increase in the gas tax, while others were opposed.

The current federal gas tax of 18.4 cents per gallon on unleaded and 24.4 cents on diesel has not been increased since 1993.

Trump previously suggested that a gas-tax bump would be on the table as part of an infrastructure package, but the proposal was not included in a leaked draft of the White House infrastructure package.

During Tuesday’s State of the Union address, Trump said his administration would attempt to create $US1.5 billion of infrastructure investment. The plan would put $US200 billion in federal money toward projects over the next 10 years to try and draw out the other $US1.3 trillion in the form of state, local, and private investment.

One glaring omission from both Trump’s speech and the leaked plan is a method to pay for the cuts. A gas-tax increase would be one method, but reports indicate the administration currently favour simply cutting so-far unnamed spending on other programs.

Democrats have attacked Republicans for favouring the wealthy and corporations with their tax bill. Bumping the gas tax could play into that narrative, and scuttle the increasingly positive sentiment about the tax plan.

Read the full report at Axios »

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