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News-Sentinel.com Your Town. Your Voice.
Opening Arguments

Pump pain pill

 John Gregg wants to give us a break at the gas pump:

The Democratic candidate for governor told The Times on Tuesday he's working on a plan to eliminate Indiana's 7 percent sales tax on gasoline, which makes up about 25 cents of the price of each gallon.

"There's some help we can give, and I think it's important that we try to do that because it's causing Hoosiers to suffer," Gregg said. "When gas gets to $4 a gallon, it crimps Hoosiers' pocketbooks, and it has resulted in a windfall to the state."

Indiana sales tax collections in February were $11 million more than February 2011, in part because gasoline sold for an additional 50 cents a gallon this year. The state also has $1.7 billion in reserve.

Gregg is talking about ending the sales tax on gas, not just suspending it for a time as some politicians have done in the past, which means we can take it as a serious proposition and not just a campaign stunt. But I tend to like this idea better:

U.S. Rep. Mike Pence, the Republican candidate for governor, said he's "not opposed to lifting the sales tax" but would prefer Indiana enact "across-the-board tax relief that will encourage investment and create jobs."

As with any tax-cut idea, the question that always needs to be asked is: What will you do about the resulting reduction in revenue -- decide to spend less or try to make it up somewhere else?


Wed, 04/04/2012 - 10:55am

Don't worry, they'll just take the money out of education, as always. There's a reason Indiana increasingly scores down there with Mississippi and West Virginia on educational attainment and all the things associated with poor education, such as obesity, smoking and a tendency to vote for Republicans.

Harl Delos
Wed, 04/04/2012 - 11:55am

Most people buy gas by itself.  Same with liquor.  It makes sense as a revenue-neutral move to raise the excise tax on products like that, and eliminate the sales tax, simplifying things.

I'm opposed to lowering the sales tax on products because producers decided to charge more.  That results in producers raising prices still more, because they don't suffer the consequence of reduced demand.

The free market works better if gummint doesn't pick winners and losers, and cutting the tax on gasoline is picking the petroleum companies to be winners.  That kind of redistribution of wealth just doesn't make sense.