A WRAL story on the gas tax reports that taxes don’t really factor in to the price at the pump.
WRAL could not have gotten the story more wrong. This excerpt from the online version says it all:
“Foster and other DOT officials argue that there is little correlation between the gas tax and the actual cost at the pump. Whether a station in Raleigh charges $3.47 or $3.59 a gallon, the tax is the same, they said.” (emphasis added)
Whether a station charges $3.47 or $3.59 a gallon depends on location and competition. Yes, the tax is the same no matter the station but that gas tax still adds an additional 32.5 cents to the cost of every gallon of gas.
NC gas prices currently average $3.50 a gallon so the gas tax is actually almost 11% of the price per gallon.
I don’t see what’s wrong about the statement. I assume they mean since the gas tax is a flat fee per-gallon, it doesn’t increase with the price of gas. In fact, using your calculation, if the price of gas is $5/gal, the tax percentage is *less*.
#math
Actually part of the NC gas tax is pegged to the average wholesale price of gas over the past 6 months and is adjusted twice a year. Expect when it is recalculated this summer for the tax to go up.
Last year the legislature turned what had been a cap into a floor so that part of the tax can never go any lower but can always go up. So in the long run the tax will cause rising gas prices to go up even more!