Ish. Gas prices fall because people don’t drive as much. The whole supply-and-demand thing.
In this particular instance, everyone who is into Trucking knows that logistics / truckers are losing jobs left-and-right. We are already in a “freight recession” (sector-wide recession), no promises it spreads to the general economy. But when truckers enter a recession, there’s less taxes because less gasoline is being consumed.
That’s why people fear falling gas prices. Because it means the economic engines (trucking, freight, deliveries) are slowing down. And that absolutely has an effect on taxes. Even fixed-taxes like gas taxes.
Fewer people buying gas means less overall revenue. This is due to EVs, more fuel efficient vehicles, and people driving less from things like work from home policies.
I thought the gas tax was a fixed number rather than a percentage, wouldn’t that mean the revenue would stay the same?
Ish. Gas prices fall because people don’t drive as much. The whole supply-and-demand thing.
In this particular instance, everyone who is into Trucking knows that logistics / truckers are losing jobs left-and-right. We are already in a “freight recession” (sector-wide recession), no promises it spreads to the general economy. But when truckers enter a recession, there’s less taxes because less gasoline is being consumed.
That’s why people fear falling gas prices. Because it means the economic engines (trucking, freight, deliveries) are slowing down. And that absolutely has an effect on taxes. Even fixed-taxes like gas taxes.
Fewer people buying gas means less overall revenue. This is due to EVs, more fuel efficient vehicles, and people driving less from things like work from home policies.
I imagine many places do. My city has a sub 1% tax.