LeftLaneNews

Proposed gas-tax holiday tagged as "intellectually dishonest"

With gas prices approaching and exceeding the $4 a gallon mark, presidential hopefuls Sens. John McCain and Hillary Clinton are proposing a measure that would suspend the 18.4-cents-a-gallon federal tax on gasoline. While the proposal could help rally votes for the upcoming election, industry officials are concerned that the move would send mixed messages about the U.S.' energy policies.

"You have to have alignment," Jim Press, a Chrysler president and vice chairman, told the Detroit Free Press. The concern is that if gas prices are lowered, it will encourage consumers to go back to less fuel-efficient vehicles, just when many were trading in their trucks and SUVs for more economical vehicles. The move has the potential to throw off the alignment that has been years in the making.

"I've never heard of a plan that says, 'I want you to use less of something, but I'm going to reduce the price,' " said AutoNation CEO Mike Jackson.

Instead, some automakers would actually like to see a gas tax increase, therefore encouraging consumers to purchase more fuel-efficient vehicles. Some industry experts -- such as General Motors chairman Bob Lutz -- feel that a higher gas tax would have been a better policy than the recently passed CAFE standards.

Through the first three months of 2008, small car sales were up 3.4 percent while the overall industry saw sales drop by 8 percent, including sharp decreases in truck and SUV sales.