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Mass. House Passes Transportation Tax Bill That Includes Hikes On Gas, Ride-Sharing 

A bill passed by Massachusetts House lawmakers Wednesday would increase the state's 24-cents-per-gallon gasoline and diesel taxes would increase by 5 cents and 9 cents, respectively.
(Charles Krupa/AP)
A bill passed by Massachusetts House lawmakers Wednesday would increase the state's 24-cents-per-gallon gasoline and diesel taxes would increase by 5 cents and 9 cents, respectively. (Charles Krupa/AP)

The Massachusetts House of Representatives approved a major tax bill Wednesday night that Democratic leaders say will generate more than half a billion dollars for transportation infrastructure by increasing taxes or fees on gasoline, corporations, ride-hailing services and vehicle purchases by rental car companies.

Lawmakers voted mostly along party lines in favor of the bill, 113-40, after about eight hours of session that featured little public debate and lengthy periods of public inactivity.

Representatives rejected or withdrew dozens of amendments that would have rewritten key sections of the bill, opting instead to advance a revenue-heavy bill, with few prescriptions for how the money should be spent, similar to the version offered by House Speaker Robert DeLeo and his top deputies.

DeLeo and other elected officials had pledged since last year that they would take action to raise new revenue for transportation, hoping to revitalize the aging and unreliable MBTA system, inject more money into road maintenance, and offer greater support to regional transit authorities.

"It has become clearer by the day that the need for more transportation revenue is real and it is immediate," said Rep. Aaron Michlewitz, chair of the House Ways and Means Committee, during debate. "Whether your constituents come from a district that is considered urban or rural or anything in between, it is undeniable that our transportation system is not meeting the needs that our citizens expect and deserve."

Under the bill , which Democratic leaders project will bring in $522 million to $612 million per year, the state's 24-cents-per-gallon gasoline and diesel taxes would increase by 5 cents and 9 cents, respectively.

Those hikes would be the first of their kind since 2013, when Beacon Hill approved a controversial law that included sections indexing the gas tax were repealed by voters in a referendum just one year later. That law increased the gas tax by 3 cents.

The House's proposal also seeks increases to the corporate minimum excise tax, which has not been changed in 30 years, from $456 for all companies to a tiered structure at the top of which companies with more than $1 billion in sales would pay at least $150,000.

Transportation network companies such as Uber and Lyft would be subject to higher costs as well. The bill would increase the $0.20-per-trip flat fee to $1.20 for each non-shared ride and $2.20 for every luxury ride — while keeping the cost the same when users carpool. The legislation does contain language aimed at preventing the companies from passing those hikes directly onto riders.

An amendment the House adopted also blocks those fees from applying to riders who use the companies for paratransit service.

The fourth prong of the revenue bill would require rental car companies to pay sales tax when they purchase vehicles for their fleets, a tax from which they are exempt under existing law.

Every Republican member of the House voted against the proposed tax increases, as did independent Rep. Susannah Whipps and eight Democrats.

Republican Gov. Charlie Baker said last week he was "disappointed" with the legislation and opposes both the gas and corporate tax increases, foreshadowing a potential veto that Democrats could override with a two-thirds votes.

Based on Wednesday's results, the supermajority party appears to have the votes for an override if necessary.

The House shot down amendments from the GOP that would have scrapped or blunted several of the tax and fee hikes.

President Karen Spilka has already said she believes any new transportation revenues should be used to "change behavior," particularly by reducing public transit fares. The Senate has not laid out any concrete plans to date to consider the House bill.

The House's approval for a gas tax hike comes as the Baker administration works to implement a regional cap-and-trade program on transportation emissions that officials project could prompt price increases at the pump between 5 cents per gallon and 17 cents per gallon.

That program, known as the Transportation and Climate Initiative, has come under fire as elected officials in other states have questioned its potential impact or outright declared their intention not to join. While Democratic leaders in the Massachusetts Legislature have not opposed the effort, they have raised doubts about its viability.

The transportation bill they unveiled last week includes language that would effectively require the administration to walk back the gas tax increase if TCI is implemented and raises prices. Rep. Michelle Ciccolo filed an amendment to strip that language, but she withdrew it Wednesday.

State House News Service's Colin A. Young contributed to this report.

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