In A Marathon Day, Tennessee House And Senate Approve Plan To Increase Gas Tax

Apr 20, 2017
Originally published on April 19, 2017 8:47 pm

After nearly three months of debate, Tennessee lawmakers are on the verge of sending Governor Bill Haslam a plan to pay for roads by raising the state's gas tax.

It's more or less the proposal Haslam asked for. But getting it through the legislature was a long, hard slog.

None of the House of Representatives' leaders was eager to present the plan. So state Rep. Barry Doss, a little-known contractor from Lawrence County, drew the task.

He argued the so-called IMPROVE Act was the right mix of increases and tax cuts. And, Doss noted, the state hasn't increased its gas tax since 1989.

"Guys, that's a long time. And it's time that we do something for our infrastructure."

That something is hiking the gas tax by 6 cents a gallon and the tax on diesel by 10 cents. Plus, a $5 increase to car registrations and a $100 annual fee on electric vehicles.

Those will be offset with a 20 percent reduction to the sales tax on food, a major cut to a business tax paid primarily by manufacturers and speeding up cuts to the tax on investments.

Backers of the IMPROVE Act, House Bill 534, claim those are the biggest tax cuts in state history — if you don't factor in the gas tax hike.

A prominent critic of the plan, East Tennessee Republican Jerry Sexton, said that's not generous enough to help most Tennessee families.

"We're not representing those people," he said. "We're representing the special interests — the road builders and the trucking association — those people that's going to benefit from it, but we want our mom and dads to pay for it."

Sexton favored an alternative plan that would've paid for roads by taxing vehicle sales. But that proposal failed during the day's long debate.

What emerged from the legislature was close to the proposal Haslam called for back in January: A gas tax hike, combined with plenty of sweeteners. Only a few tweaks were made along the way, like chipping a penny off what drivers will pay at the pump and for truckers, taking two cents off.

But Senate Majority Leader Mark Norris, R-Collierville, said those were all that were needed.

"It was significantly different enough that, for example, Americans for Tax Reform and some of the conservative radio talk show folks all saw it truly for what it is, which is a net cut."

And there may be one more tax cut on the way. At day's end, the Senate voted to extend $7 million in property tax relief to disabled veterans.

The House is expected to sign off on that cut next week, before sending it to Governor Haslam for his signature.

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