White House Considers Vehicle Mileage Tax to Fund Infrastructure, Says Buttigieg

The White House is weighing a variety of ways, including a vehicle mileage tax, to fund what is expected to be multi-million dollar infrastructure proposals, Transportation Secretary Pete Buttigieg said Friday.

Buttigieg, who spoke with CNBC’s Kayla Tausche, also argued that President Joe Biden’s upcoming plans to rebuild US roads, bridges and waterways would generate a net gain for the American taxpayer and not a net outlay.

“When you think of infrastructure, it is a classic example of the type of investment that has a return on that investment,” he said. “That’s one of the many reasons we think this is so important. This is an employment vision as well as an infrastructure vision, a climate vision and more.”

It also weighed several potential income-generating options to finance the project. He spoke fondly of a mileage tax, which would tax travelers based on how far they travel rather than how much gas they consume.

Democrats have slowly backed away from a gasoline tax amid a simultaneous, climate-friendly effort to encourage consumers to drive electric cars.

Pete Buttigieg speaks at the Senate Commerce, Science and Transportation nomination hearings to examine his expected nomination to be Secretary of Transportation in Washington.

Ken Cedeno | Reuters

“I hear a lot of interest in making sure there are sustainable sources of funding,” the transportation secretary said. A mileage tax “is very promising if we believe in the so-called user-pays principle – the idea that part of how we pay for roads is that you pay based on how much you drive.”

The transportation secretary’s comments came as President Joe Biden prepares to detail sweeping infrastructure proposals that could cost between $ 3 billion and $ 4 billion during a trip to Pittsburgh next week.

In his first press conference of his presidency, Biden said Thursday that rebuilding America’s physical and technological infrastructure was his next big task, critical not only to efforts to restore the economy, but also to remain competitive with rivals such as China.

Buttigieg added Friday that the White House is considering a revival of Build America Bonds, a special class of municipal bonds first introduced in the Obama administration with interest costs financed by the US Treasury.

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The BABs are “very promising in terms of the way we leverage that kind of financing. There have also been ideas around things like a national infrastructure bank.”

His comments on Friday came a day after he implored Congress on Thursday to make a “generational investment” to improve the nation’s roads, bridges and waterways and combat climate change and racial inequality.

“There is almost universal recognition that a broader recovery will require a national commitment to fix and transform America’s infrastructure,” Buttigieg told the House Transportation and Infrastructure Committee.


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