Small Business Announces Support for Bolger Road Funding Plan
December 3, 2014 (Lansing) –The state’s leading small business organization – the National Federation of Independent Business (NFIB) – announced support today for the road funding plan recently proposed by House Speaker Jase Bolger.
Bolger’s plan would gradually repeal the current 6 percent sales tax on gasoline and replace it with a percentage tax on the wholesale price of fuel annually over six years. This would mean that the current sales tax revenue would gradually be shifted to funding roads and not local governments and schools. The plan would raise an estimated $1 billion more annually for roads, while the pump tax would remain the same based on current wholesale price levels. With this proposal all of the money paid at the pump would go toward road funding.
“We salute the Speaker for thinking ‘outside the gas tax box’ when it comes to road funding,” said NFIB State Director Charlie Owens. “While we recognize the need for good roads and adequate funding, this is a difficult time for fuel tax increases on Michigan small business job providers.”
Owens said that a recent survey of NFIB small business members on the Bolger plan showed that 70 percent supported the plan, 19 percent opposed the plan and 11 percent were undecided. Prior member surveys on increasing the gas tax to fund roads received little support.
“While current gas prices have moderated from the high levels of four dollars or more a gallon, efforts to hike the pump tax – such as the recent Senate legislation – will place Michigan among the highest gas tax states in the country and any future increases in gasoline prices will only exacerbate this situation,” said Owens. “Raising the pump price of fuel along with the recent increase in the minimum wage and health insurance hikes under Obamacare will put even more pressure on the bottom line of Michigan’s small and family owned businesses and threaten to jeopardize Michigan’s economic recovery.”
The S-13 version of HB 5477 that passed the Senate on November 13th, seeks to raise the wholesale fuel tax to 15.5 percent by 2018. It is estimated that a 15.5 percent tax on the wholesale price could raise the current 19 cents per gallon gasoline tax to as much as 45 cents per gallon, depending on the wholesale price of gas.
Owens expressed optimism that Speaker Bolger’s plan will gain acceptance during the remaining lame duck session and could become law by the end of the year.