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Trivia Tidbit Of The Day: Part 502 - Gas Taxes Do Not Exist Within A Vacuum.

Lower Tax Burdens Mean Higher Job Growth-

Governments often like to extract money from citizens through vice taxes, sin taxes, and luxury taxes. Alcohol, tobacco, firearms. And yachts. Things like that.

In recent times, with the rise of the Church of Global Warming, gasoline is a vice, a sin, and a luxury.

But, as those of us who like to travel further than our bicycles can take us know, gas is not a luxury. It's a necessity.

When gas is too expensive, people are less productive. They'll buy less stuff. They'll stay closer to home to buy the stuff they will still buy. They'll take fewer and shorter trips. This all might sound like Elysium to some, but for an economy based on fossil-fuel-driven transport of trade and commerce, this is all problematic. While Democrats/media have been crying wolf about "record" gas prices for years, we actually are at record levels this year.

And high gas prices, along with the bursting of the housing bubble, are harming what is an otherwise fundamentally sound economy.

While John McCain's federal gas tax holiday proposal was not well-received in the establishment of Washington, academia, the media, or almost anywhere else, it did-- at the very least-- focus a bit of attention on the fact that gas taxes are a significant portion of the gas we buy.

Some states apply a tax far greater than others on a gallon of gas. California (45.5 cents), for example, charges twice the national state-level median (23.5 cents).

So let's take a peep at the state gas tax in relation to jobs created in the private sector:

Higher gas taxes are not free of negative consequences. They are still a burden on real people. And those real people may respond to that burden by engaging in a bit less commerce.

Of course, much of this relationship is based on the fact that states with high gas taxes tend to have other high taxes, as well. Absurdly high gas taxes indicate that a state has a tendency to intrude into the economy.

To dive into some of this data, click here for an Excel spreadsheet.

Previous Trivia Tidbit: Higher Taxes, Worse Economy.

Posted by Will Franklin · 27 June 2008 07:12 AM

Comments

Posted by: Kat at June 27, 2008 09:26 AM