BILL WOULD REPEAL MOTOR FUEL EXCISE TAX ON RAILROADS, INLAND WATERWAYS
A bill introduced last week by Sen. Fred Thompson, R-Tenn., would repeal the 4.3-cent motor fuel excise tax on railroads and inland waterway transportation.
The bill is identical to a House bill introduced earlier this month, and reprises a bill introduced in the last Congress by Sen. John Chafee, R.I. Congress voted to repeal the tax as part of the Taxpayer Refund and Relief Act of 1999, which was vetoed by President Clinton.
The tax had been imposed in the Omnibus Budget Reconciliation Act of 1993 on all transportation fuels as a means to help reduce the federal budget deficit. Prior to the act, the gasoline, aviation and diesel fuel excise tax had been considered “user fees,” and revenue raised from the taxes was deposited into the transportation trust funds dedicated to improving highways, airports and waterways.
In 1997, Congress redirected the 4.3-cent gasoline tax back into the highway trust fund and the 4.3-cent aviation fuel excise tax back into the airport and airway trust fund as part of the surface transportation reauthorization bill, TEA-21.
“However, the final version of TEA-21 did not touch the tax on inland waterway barge fuel or railroad fuel, so that tax revenue is still being deposited in the general fund,” Thompson said. There is no railroad trust fund.
The bill is co-sponsored by Senators John Breaux, D-La.; Frank Murkowski, R-Alaska; Jim Jefford, R-Ver.; Phil Gramm, R-Texas; Don Nickles, R-Okla.; and Blanche Lincoln, D-Ark.