Bill would add 5-cent tax to many fuel sales in Arkansas

| Monday, March 14, 2005

Truckers and other drivers in Arkansas would pay another nickel each time they use plastic to pay for fuel at the pump under legislation intended to help improve the state’s highways.

Rep. Phillip Jackson, R-Berryville, said his bill could be an alternative source of revenue for a $1 billion highway bond program being pushed by Gov. Mike Huckabee – or go into the state’s treasury if it couldn’t be tied to road improvements.

“If we get some reasonable data and it looks like something that’s viable, then I’ll talk to the governor about it and the highway department to see if they’ll support it,” Jackson said.

Under the bill, fuel retailers would add 5 cents to each purchase made by use of a credit or debit card, gift card or any other method of electronic payment. It would not be a per-gallon fee.

Huckabee spokesman Rex Nelson said that the governor was open to suggestions on financing highways, including Jackson’s bill – HB2838.

“While this isn’t our bill, the governor consistently has said he will be open to any means of paying for highway construction. We would certainly consider this a viable option,” Nelson told The Associated Press.

Jackson said he’s had difficulty coming up with research to determine how much the measure would generate.

Another bill filed recently would divert some of the state sales tax revenue generated from the sale or purchase of new vehicles, trailers and semi-trailers to raise the $134 million a year that highway officials say they need to pay for Huckabee’s proposed bond issue.

Nelson said that the bill by Rep. Johnnie Bolin, D-Crossett, was the basis for the governor’s highway plan, which would ask voters to approve a $134 million tax increase by referendum, maybe as early as this summer.

If approved, it would break with the state’s pay-as-you-go highway user fees, which financed road construction until a $1 billion bond issue approved by voters in 1999.

Randy Ort, spokesman for the Arkansas Highway and Transportation Department and the state Highway Commission, said highway officials were analyzing the bill and its ramifications.

HB2838 is in the House Revenue and Taxation Committee. Bolin’s bill – HB2887 – is awaiting consideration on the House floor. It previously passed the House Public Transportation Committee.

Comments