In total, JCT [Joint Committee on Taxation] estimates the value of the value of fossil fuel tax expenditures at approximately $11.8 billion for the five-year period of 2022-2026. The tax expenditures denoted as de minimis and the ones not quantified are not included in this estimate.
This is from “Statement of Ted Gayer,” before the U.S. Senate Committee on the Budget hearing on “Who Pays the Price: the Real Cost of Fossil Fuels,” May 3, 2023. Gayer is the president of the Niskanen Center.
The whole thing, which is only 7 pages long, is worth reading.
Here’s what I find striking: how low the numbers are. They average $2.4 billion annually. This is strikingly from so many claims we often hear that fossil fuels are subsidized by hundreds of billions annually. The number Gayer comes up with is just 1.2 percent of $200 billion.
Moreover, nowhere in his testimony does he mention gasoline taxes. In 2020, state and local governments collected $53 billion in revenue from taxes on motor fuels. Of course, it is true that most of these revenues go to road building and maintenance.
The pic above is from his testimony, and covers one of the 4 types of “tax expenditures” that Gayer discusses.
