How Much Should Highway Fuels Be Taxed? Resources for the Future, January 6, 2010. "Gasoline consumption on the nation's roads and highways account for one-fifth of U.S. carbon emissions. Meanwhile, traffic congestion continues to worsen and fatal vehicle accidents kill 40,000 people annually. Such conditions suggest that imposing higher taxes on highway fuels could have positive consequences - and would bring the United States more in line with policies of many European countries that tax gasoline more heavily. In a new paper, How Much Should Highway Fuels Be Taxed?[PDF, 35 pp] Ian W.H. Parry, the Allen Kneese Chair and RFF Senior Fellow, puts the economically efficient level of taxation at $1.23 per gallon for gasoline and $1.15 per gallon for diesel fuel. However, the paper also warns that the case for higher taxes can be greatly undermined if revenues are not used to enhance economic efficiency."
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