NASHVILLE, Tenn. (AP) — An effort to strip a proposed gas tax hike from Gov. Bill Haslam’s plan to boost transportation funding in Tennessee faced an expected vote today in a key House committee.
The change supported by Republican House Speaker Beth Harwell would rewrite the legislation to instead draw the bulk of the funding for new road and bridge construction from sales taxes paid on new and used vehicles. It also would create new taxes on electric and hybrid vehicles, and increase registration fees.
The proposal does not include any of the tax cuts that the governor has proposed to balance against a gas tax hike. They would include a 20 percent reduction in the sales tax on groceries, a $113 million cut in corporate taxes paid by manufacturers and dialing back the tax on earnings from stocks and bonds by 1 percentage point. The cuts would total a greater amount than what would be raised by the fuel tax increases.
The proposed alternative drew a swift rebuke from Senate Majority Leader Mark Norris, a Collierville Republican who like Harwell is strongly considering a bid for governor next year.
“We are actually returning money to the taxpayers, a tax cut is money in their pocket,” Norris said. “When they reshuffle the deck by raiding the general fund, the taxpayer never sees that.