Proposed tax cuts are a Band-Aid

Published 12:00 am Tuesday, September 6, 2005

There have been calls for the state of Alabama to follow Georgia’s lead and reduce or cut the taxes on gas until the current pricing crisis is over.

The sentiment is correct, but the direction misplaced.

The price of gasoline should indeed be cut, but cutting gas taxes is a fix in name only.

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What taxes the government loses through one revenue stream will have to be made through another tax, or government services will have to be cut to make up for the loss.

Either way, the costs of cutting the gas tax will be handed down to the taxpayer.

A more realistic fix is needed. We have watched as gas prices climbed steadily.

We were amazed when they breached the $1.75 and then the $2 mark.

Then came Hurricane Katrina, a gas panic and prices skyrocketed towards $3 a gallon.

At the same time, U.S. Oil Companies reported record profits and brokers cashed out on Wall Street with profits that will carry them through the next year.


We have a system in which oil companies can immediately pass price increases down to the consumer, despite the fact gas in the pump was produced at the lower price.

At the same time, oil price decreases can take weeks to reach the consumer.

In the end, before our governments cut one cent of tax revenue, those making record profits should step up and do the right thing.

Instead of passing repair costs straight to the consumer, how about using a few of those record profits to repair the damage to the Gulf Coast’s oil system?

Why must the consumer carry the burden?

Instead expecting governments that are already in financial crisis to cut more, why not take a little less profit over the next few months until the gas situation is stable again?