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Utah House leaders unveiled a sort of magic trick on Thursday a proposal to increase revenue for transportation without technically voting for a tax hike.
But they acknowledge it still would likely raise gasoline prices over time, and also would lead to increasing local sales taxes by a quarter-cent per $1 purchase if voters approved.
House Transportation Committee Chairman Johnny Anderson, R-Taylorsville, introduced HB362 to convert the state's current 24.5 cents-per-gallon tax on gasoline to what he said is "something similar to a sales tax."
It would create a percentage tax on gasoline. Initially it would be set to generate the same 24.5 cents a gallon as now, applying a percentage high enough to do that based on the average price of gasoline over the past year.
If gasoline prices increase afterward, so would revenue and that is seen as likely.
But House Speaker Greg Hughes has said House members could vote for the bill and still truthfully say they did not raise taxes. He likens it to them not taking blame if higher grocery prices produce higher sales-tax revenue.
Also, Hughes has noted that the gasoline tax has not been raised since 1997 because approving tax hikes endangers members politically. He said gas prices rise at least some of the time, so the change would bring some long-overdue increases for transportation.
Anderson said his bill includes a "floor" to prevent revenue from dropping below the current 24.5 cents per gallon. That floor would increase automatically each year with inflation.
It also includes a "ceiling" to help prevent windfalls. Currently that proposed ceiling is at $4 a gallon which could allow big revenue increases, but Anderson said that is a point of continued negotiation. "It's not going to stay there," he said.
Senate leaders have opposed converting to a percentage tax on gasoline. Sen. Kevin Van Tassell, R-Vernal, introduced SB160 to raise gasoline by 10 cents a gallon, and a committee endorsed it.
Van Tassell said that proposal is straightforward and transparent, instead of "saying you're not raising the tax, and then turn around and I am paying more at the pump."
Senate President Wayne Niederhauser, R-Sandy, said the House proposal likely could result in much higher taxes than Van Tassell's bill, and said senators do not support the idea.
Anderson's bill also would allow voters to approve a sales-tax increase of a quarter-cent per $1 purchase to help cities, counties and transit districts, such as the Utah Transit Authority. Because voters must approve it, legislators again could say they did not raise taxes.
In Salt Lake, Weber, Davis and Utah counties, the bill would divide the extra quarter-cent in tax that so that a tenth-cent each would go to UTA and cities, and counties would take .05 cents for transportation projects of regional importance.
In other counties, cities would take a tenth cent, and counties would take .15 for roads and other transportation projects.
Cities, counties and UTA jointly proposed those amounts, said Anderson.
The bill reflects what House members said they wanted in a GOP caucus in December, but it has not discussed the matter since and he said compromise will be sought with the Senate.
"I still believe we will accomplish something this year. I don't think it will look exactly like this. I don't think it will look like Sen. Van Tassell's bill. But something will happen," he predicted.