Evening star., 1935-11-03
GAS TAX DIVERSION
THREAT RISES HERE
Washington Motorists Face
Danger Of Losing Levy
Benefits.
BY THOMAS p. HENRY,

BY THOMAS p. HENRY,
President. American automobile Associa'ioh'
The threat Of gasoline tax diversion
which loomed on almost every State
whose Legislature met this year now
has advanced upon the District OF
Columbia, and Washington motorists
are faced with the danger that the
money they pay for improvement ana
maintenance of their streets Will De
snatched away for general revenue
purposes.
Under the proposal to divert District
Of columbia gas taxes the specia!
highway fund would be abolished ana
revenues from this source would be
iumped in with the general fund.
OF. all the proposals that have ever
been advanced to mulct the motorist
of his dollar none Is more indefensible
than is diversion of gasoline taxes.
The gasoline tax is a special tax de-
signed for a special purpose. Afford
ing a good measure of road usage. the
gasoline tax was and is one OF the
fairest methods of placing the motor
!st oh a pay-as-you-go tax basis.
But this is true only as long as the
tax Is applied to the purpose for which
it is designed. The minute that the
tax hungry begin applying revenues
from this source to other than high
way purposes, all justification for the
tax disappears and an unjust and dis
eliminating burden of tax is placed
on the shoulders of the motorist.
The proposal to dump District OF
Columbia gas taxes into the general
fund are at such wide variance with
generally approved and well estab-
lished motor tax principles that they
must be challenged as revolutionary
and directly involving the interests OF
the owners Of the 10000 motor We
hiclss in the District of Columbia.
Under the law passed by Congress
and approved by the President, gaso-
line tax revenues are now ear-marked
for street improvement and repairs.
In practically every one of the 48
States the law specifically provides
for = State highway fund and no one
30 far as ! know has ever before ad-
vocated abolition of these special
funds. The levying Of special motor
vehicle taxes and the use Of these
funds for highway purposes have been
the basic factors in the development
OF the Federal and State highway sys-
tens Of this country.
The injustice of diversion of gaso-
line taxes is widely recognized. The
1884 Federal aid act branded motor
vehicle taxation as unfair and un-
Just" and provided penalties for States
found guilty of diversion. The Fed
eral Oil Conservation Board in a re-
port to President Roosevelt has taken
. firm stand against diversion.
Diversion Held Invalid.
An Ohio court held diversion to be
unconstitutional under State law, de-
claring:
If it comes to the pass that the
State and its political subdivisions be
not required to apply their apportion-
ments Of this tax to the construction
and upkeep of the public roads, but
may be authorized to use the same as
general revenues, then the door is open
and owners and users of motor We
hicleS are likely to be overwhelmed
with confiscatory and excessive tax
alton"
The American Automobile Associa-
ton and its afliliated clubs have in
variably fought vigorously against di-
version Of motor vehicle taxes wher-
ever threat OF such action has been
raised. In addition, in several States
success has attended efforts to write
into the basic law Of the State prohi-
bition against any future diversion.
The results that almost invariably
follow when once a course has been
set in the direction of diversion are
more than sufficient to justify the
most vigorous opposition to i-jacking
OF gasoline tax money. The principal
effects of gasoline tax diversion are:
l. Diversion subjects the motorists
to double taxation and imposes on
them as q class disproportionat
share of the cost of government. The
motorists pay their share of the gen.
eral cost OF government in their
ordinary capacity as payers of gen.
eral taxes. Motor taxes are special
additional levies for a special purpose
and their application to anything but
that particular purpose constitutes
discrimination.
Higher Taxes Encouraged.
2. Diversion encourages higher mo-
tor taxes-taxes out Of ratio to prop
erly ascertained road costs and
motorist obligation for these costs.
3. 1t endangers the road bonded
indebtedness Of the States.
4. 1t puts in jeopardy the large
investment in highways-since the
tendency in States where diversion
Is rampant has been to neglect or
defer maintenance.
5. This condition in turn adds to
the highway hazard.
6. Diversion encourages the use
OF road funds as q pork barrel for
political adventures.
z. Diversion of road funds to other
governmental needs, however deserv-
ing these needs in themselves may be.
tends to delay the overhauling of tax
structures in the interest Of stability,
dependability and equity.