Low carbon fuel standard’s “hidden” gas tax

With Washington having the third-highest gas tax in the country, critics of a proposed low carbon fuel standard (LCFS) say it would make fuel prices even higher but without the benefits of gas tax revenue in transportation investments. …

If approved, the bill directs the state Department of Ecology to set up the LCFS program and have it running by 2021. Importers or producers of fuels above the established baseline would have to register in the program. However, fuel used in aircrafts, vessels and trains would be exempt. …

Washington Trucking Association President Sheri Call told the [House Committee on Environment & Energy] that out-of-state truckers have the capacity to drive in and out of Washington without ever refueling, putting in-state truckers at a competitive disadvantage. As a low-margin business, “even a small increase in the cost of fuel is impactful to us.”

Ennis argued that it’s “wishful thinking” to believe the increased operating costs won’t be reflected in consumer prices.

Ben Buchholz with Food Northwest and the Northwest Agricultural Cooperative Council told the committee the program would be “essentially a hidden gas tax embedded in the price” of fuel” and would have a “significant financial impact” on those who rely heavily on fuel to grow, harvest and transport their produce.

Currently, California and Oregon have LCFS programs. In California, the standard is partially implemented but has already raised the price of gasoline by $.13. One estimate puts the final price increase between $.40 to $.70 by 2030. …

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