Sales tax holidays (upcoming dates are blogged about here) have managed to hold on despite tough times for state treasuries, but the idea of a summer gas tax holiday never had a chance.
The reason? Politicians weighed the electoral cost of making some highway-bound vacationers happy vs. irking hundreds of thousands who would lose their jobs if the fuel tax money flow was halted.
The graphic below from the Associated Press shows the projected distribution of highway-related jobs that would have disappeared had the fuel tax been suspended for three months.
An analysis by the House Transportation and Infrastructure Committee indicated that a summer gas tax holiday would have cost a total of $9 billion, with losses on road-related projects ranging from $30 million and 1,000 jobs in Vermont to $664 million and 23,000 jobs in California.
As the AP story notes, that's a pre-election specter that no Capitol Hill denizen, regardless of party, wants.
In fact, says the AP, lawmakers are actually talking about raising current fuel taxes -- now 18.4 cents per gallon on gasoline and 24.3 cents per gallon for diesel -- by a dime.
The added money would bulk up the Highway Trust Fund, which is heading down a deficit route.
I guess it's time to start looking for a more fuel-efficient car.
Compensating for higher pump prices: One Austin-area company is providing its workers with some added gas money.
Leander-based Cypress Technologies is calculating the cost of gas a year ago and then reimbursing its employees the difference.
Company management says the gas money bonuses are an investment in employees, ensuring the workers won't go elsewhere. The rank and file are obviously delighted to get the money.
I don't know how the gas money payments are structured, but I'm wondering if they are considered taxable or tax-free fringe benefits to the workers. The distinction could make a difference, although according to this H&R Block item on benefits, even if the value of a fringe benefit is included in your taxable income, you still come out ahead.
The IRS has a guide to fringe benefits and their various tax treatments, and it notes that some qualified transportation expenses can be excluded from worker wages. But this typically covers transportation to conduct work duties away from the main office.
Transportation expenses, notes the IRS guide, must be distinguished from commuting costs, which are not excludible from employee income.
Commuter savings account coverage: However, a company can set up a tax-advantaged commuter savings account (CSA) for workers.
This is similar to flexible savings plans for medical costs and child care, in which a worker puts pre-tax money into the accounts to pay for eligible transit and/or parking expenses incurred in getting to the office.
Payroll deduction amounts, chosen by the employee, are made up to the annual limits set by the IRS; for 2008, the monthly maximums are $115 for mass transit or van pooling fees, $220 for parking charges.
Typically, vouchers are provided for mass transit options. For the cost of parking at the bus or train station or at a garage near the office, the employee is reimbursed from the account.
Sorry, but you can't get money to cover your car's fill-ups, but the parking coverage should give you more gas money.
This calculator can help you see how much a CSA could save you.
Share your gas tips: How are you dealing with the high price of fuel?
Does your company offer a commuter savings plan? Are you enrolled or plan to enroll during the upcoming benefits open season?
Are you driving less? Car or van pooling?
Taking alternative transportation? Telecommuting? Buying a hybrid?
Share your gas- and money-saving tips with us in the comments section.