Pa. panel suggests removing tax cap on oil companies

    Among the recommendations handed down by Gov. Tom Corbett’s Transportation Advisory Commission is removing the cap on taxes paid by oil companies on wholesale gas.

    The panel making the recommendations said that if uncapping the tax does make the price of gas at the pump go up, by the time it’s completely implemented, the additional cost to drivers would be about 20 cents a year.

    However, could the higher price of gas also be embedded into other products–products that have to be flown and shipped and driven to the store where you buy them?

    Steve Chizmar, a PennDOT spokesman, said there’s no evidence to believe that will happen. The last time oil companies experienced a tax hike, Chizmar said the price of gas went down for the consumer.

    “What that really points to is there’s so many more factors playing a role in what people are actually paying for gas and other goods and services. You have to bring into account local competitiveness,” he said. “You know what the person across the street is charging. There’re just so many factors in the way goods and services are priced.”

    Another recommendation of the panel  is a law allowing the private sector to enter the business of building and maintaining transportation infrastructure.

    Public-private partnerships would allow the government to outsource building or repairs to businesses and investors, theoretically speeding up the construction process.

    Cheryl Hicks, executive director of the state House Transportation Committee, says lawmakers still need to consider the plan carefully.

    “That would eliminate the need for the state to put money into it, it would help the situation,” Hicks said. “However that would cost the constituency, the citizens a fee, because the private entity isn’t going to take over a road or a bridge and not charge a toll.

    Hicks said it’s not a comprehensive solution to the problem of transportation funding and it won’t be popular with everyone.

    She noted proposals have already been introduced regarding public-private partnerships.

    The public-private partnership and removing the tax cap on oil companies, like most of the recommendations made by the advisory commission, require lawmakers to turn it into legislation.

    To that end, the chairman of the House Transportation Committee said he’s waiting for the governor to “get out in front” and tell lawmakers which recommendations he’ll support.

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