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Having dispensed with one dumb debate about the Biden jobs plan and what counts as "infrastructure," Republicans and moderate Democrats have found another talking point that distracts from the very obvious problems the country needs to address. That talking point is "user fees." The pared-down infrastructure counterproposal, backed by the bipartisan Problem Solvers Caucus, is touted as more reasonable than Biden's plan because it costs less and can be paid for in large part by user fees, alleviating the need to tax the rich. Specifically, the "user fees" in question include increasing the gas tax and then indexing it to either inflation, an index of how much it costs to fix highways, or fuel efficiency standards set by the government. The proposal also advocates for a fee on vehicle miles traveled and an annual registration fee specifically for hybrid or electric vehicles. This is in contrast to Biden's plan which proposes raising corporate tax rates from 21 to 28 percent—still lower than the 2016 rate—and increasing taxes on U.S. companies' foreign earnings. "User fees" is one of those terms that sounds self-explanatory. And sometimes it can be. A toll, for example, is a classic user fee paid by drivers. But, in most cases when politicians or policy wonks talk about user fees, they are really just talking about taxes by another name. In fact, this country has so often enacted "fees" to avoid the appearance of increasing taxes that there is now little difference between the two. One need look no further than the Problem Solvers Caucus plan itself, which does not use the term "gas tax" but instead calls it the "federal gasoline user fee."The U.S. would be a better country if we stopped pretending there was this other, better word for taxes and went about the perfectly sensible and widely popular business of taxing rich people more to pay for the things we need.A few months ago I wrote about the useless trains at U.S. airports financed by passenger facility charges (PFCs), which are user fees on people who purchase airline tickets:Since then, I have noticed the "taxes and fees" line item on receipts a lot more. It is not just airline tickets that blur the line between taxes and user fees. For example, my latest wireless bill's "taxes and regulatory fees" section has the following line items:TAXES
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These arguments stem from the euphemism that the PFC is a "user fee" and not a tax, a distinction quite literally without a difference since they are both grouped under the "taxes and fees" line item of your flight cost (next to the PFC on your receipt are "congressionally mandated security fees" which pay for the Transportation Security Administration and is my all-time favorite euphemism for a tax). A "user fee," the logic goes, must rigorously benefit the payee while a general tax can more readily be used for the common good. From the airlines' perspective, using PFCs to pay for a mass transit connection is more like a tax and therefore an illegitimate use. It is all unbearably silly.
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