IDEAS home Printed from https://ideas.repec.org/p/mit/worpap/568.html
   My bibliography  Save this paper

Is The Gasoline Tax Regressive?

Author

Listed:
  • POTERBA, J.M.

Abstract

Claims of the regressivity of gasoline taxes typically rely on annual surveys of consumer income and expenditures which show that gasoline expenditures are a larger fraction of income for very low income households than for middle or high-income households. This paper argues that annual expenditure provides a more reliable indicator of household well-being than annual income. It uses data from the Consumer Expenditure Survey to reassess the claim that gasoline taxes are regressive by computing the share of total expenditures which high-spending and low-spending households devote to retail gasoline purchases. This alternative approach shows that low?expenditure households devote a smaller share of their budget to gasoline than do their counterparts in the middle of the expenditure distribution. Although households in the top five percent of the total spending distribution spend less on gasoline than those who are less well-off, the share of expenditure devoted to gasoline is much more stable across the population than the ratio of gasoline outlays to current income. The gasoline tax thus appears far less regressive than conventional analyses suggest.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Poterba, J.M., 1990. "Is The Gasoline Tax Regressive?," Working papers 568, Massachusetts Institute of Technology (MIT), Department of Economics.
  • Handle: RePEc:mit:worpap:568
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Poterba, James M, 1989. "Lifetime Incidence and the Distributional Burden of Excise Taxes," American Economic Review, American Economic Association, vol. 79(2), pages 325-330, May.
    2. Carol A. Dahl, 1986. "Gasoline Demand Survey," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 67-82.
    3. James A. Kahn, 1986. "Gasoline Prices and the Used Automobile Market: A Rational Expectations Asset Price Approach," The Quarterly Journal of Economics, Oxford University Press, vol. 101(2), pages 323-339.
    4. Cordes, Joseph J. & Nicholson, Eric & Sammartino, Frank, 1990. "Raising Revenue by Taxing Activities With Social Costs," National Tax Journal, National Tax Association;National Tax Journal, vol. 43(3), pages 343-356, September.
    5. David L. Greene, 1990. "CAFE OR PRICE?: An Analysis of the Effects of Federal Fuel Economy Regulations and Gasoline Price on New Car MPG, 1978-89," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3), pages 37-58.
    6. Davies, James B & St-Hilaire, France & Whalley, John, 1984. "Some Calculations of Lifetime Tax Incidence," American Economic Review, American Economic Association, vol. 74(4), pages 633-649, September.
    7. Cordes, Joseph J. & Nicholson, Eric & Sammartino, Frank, 1990. "Raising Revenue by Taxing Activities with Social Costs," National Tax Journal, National Tax Association, vol. 43(3), pages 343-56, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Brazell, David W. & Gerardi, Geraldine, 1994. "Issues in Financing the Superfund," National Tax Journal, National Tax Association;National Tax Journal, vol. 47(3), pages 677-688, September.
    2. Berthold U. Wigger, 2004. "On the Intergenerational Incidence of Wage and Consumption Taxes," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 6(1), pages 1-23, February.
    3. Fullerton, Don & Metcalf, Gilbert E., 2002. "Tax incidence," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 4, chapter 26, pages 1787-1872, Elsevier.
    4. Jean Agras & Duane Chapman, 1999. "The Kyoto Protocol, Cafe Standards, And Gasoline Taxes," Contemporary Economic Policy, Western Economic Association International, vol. 17(3), pages 296-308, July.
    5. Rausch Sebastian & Metcalf Gilbert E. & Reilly John M & Paltsev Sergey, 2010. "Distributional Implications of Alternative U.S. Greenhouse Gas Control Measures," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(2), pages 1-46, July.
    6. Raul A. Ponce-Rodriguez & Charles R. Hankla & Jorge Martinez-Vazquez & Eunice Heredia-Ortiz, 2016. "Frozen In Time: Rethinking the Poltical Economy of Decentralization: How Elections and Parties Shape the Provision of Local Public Goods," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1604, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    7. Sara Torregrosa Hetland, 2014. "A fiscal revolution? Progressivity in the Spanish tax system, 1960-1990," Working Papers 2014/8, Institut d'Economia de Barcelona (IEB).
    8. James, Simon & Alley, Clinton, 2002. "Tax compliance, self-assessment and tax administration," MPRA Paper 26906, University Library of Munich, Germany.
    9. Plotkin, Steven E & Greene, David, 1997. "Prospects for improving the fuel economy of light-duty vehicles," Energy Policy, Elsevier, vol. 25(14-15), pages 1179-1188, December.
    10. Simon James, 1999. "The future international tax environment and European tax harmonization: a personal view," European Accounting Review, Taylor & Francis Journals, vol. 8(4), pages 731-747.
    11. Lisa Cameron & John Creedy, 1995. "Indirect Tax Exemptions and the Distribution ot Lifetime Income: A Simulation Analysis," The Economic Record, The Economic Society of Australia, vol. 71(1), pages 77-87, March.
    12. Gilbert E. Metcalf, 2009. "Market-Based Policy Options to Control U.S. Greenhouse Gas Emissions," Journal of Economic Perspectives, American Economic Association, vol. 23(2), pages 5-27, Spring.
    13. Sara Torregrosa Hetland, 2015. "Did democracy bring redistribution? Insights from the Spanish tax system, 1960–90," European Review of Economic History, Oxford University Press, vol. 19(3), pages 294-315.
    14. Thomas A. Barthold, 1994. "Issues in the Design of Environmental Excise Taxes," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 133-151, Winter.
    15. James B. Davies, 1995. "Distributional Effects of the Lifetime Capital Gains Exemption: Single vs. Multi-Year Analysis," Canadian Public Policy, University of Toronto Press, vol. 21(s1), pages 159-173, November.
    16. Don Fullerton & Diane Lim Rogers, 1994. "Distributional Effects on a Lifetime Basis," NBER Working Papers 4862, National Bureau of Economic Research, Inc.
    17. Lyon, Andrew B & Schwab, Robert M, 1995. "Consumption Taxes in a Life-Cycle Framework: Are Sin Taxes Regressive?," The Review of Economics and Statistics, MIT Press, vol. 77(3), pages 389-406, August.
    18. Brazell, David W. & Gerardi, Geraldine, 1994. "Issues in Financing the Superfund," National Tax Journal, National Tax Association, vol. 47(3), pages 677-88, September.
    19. Louis Kaplow, 1993. "Should the Government's Allocation Branch be Concerned about the Distortionary Cost of Taxation and Distributive Effects?," NBER Working Papers 4566, National Bureau of Economic Research, Inc.
    20. James M. Poterba, 1991. "Tax Policy to Combat Global Warming: On Designing a Carbon Tax," NBER Working Papers 3649, National Bureau of Economic Research, Inc.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mit:worpap:568. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Linda Woodbury) The email address of this maintainer does not seem to be valid anymore. Please ask Linda Woodbury to update the entry or send us the correct email address. General contact details of provider: https://edirc.repec.org/data/edmitus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.