Gas tax hike unlikely, says House Majority Leader

Don’t expect a gas tax increase anytime soon.

That’s what House Majority Leader Rep. Kevin McCarty (R-Calif.) tells the Wall Street Journal in an exclusive interview.

“We make policy in the world of politics,” McCarty says. “If you thought, “Well, why don’t you just raise the gasoline tax?” Well, politically that will not make it. Let’s think of something else. How do you have a funding mechanism where you could actually fund a five-year plan?”

One alternative highway funding plan would tax overseas corporate revenue. According to The Hill, the proposal calls for giving business a reprieve from penalties for avoiding prior taxes if they agree to move money back to the United States and pay a 6.5 percent tax rate on it.

“There’s a coalition that cares about highways, but there’s also a coalition that cares about tax reform,” McCarthy tells The Wall Street Journal. “There’s a way that if you took the highway bill today and you extended it toward the end of the year, and you had tax reform and highways combined so you could find also a pay-for in there, those are two coalitions that are married together.”

McCarty also tells The Wall Street Journal he is not in favor of taxing overseas profits.

“I’m not talking about raising taxes,” he says. “But I see so many American companies have so much money overseas, because that’s the way the structure works.

“I do not like the version that the president has,” McCarthy adds, “but I think another version could work, and a big chunk of money can come. So that could be a one-time funding of highways. And highways could have five more years to figure out how they’re going to fund them in the future.”