House Could Scrap Proposed Fuel Levy

AS Democrats on the Senate Finance Committee hash out their own version of an energy tax, members of the House of Representatives are not sure they like what's emerging.

The Finance Committee, due to vote by tomorrow on a budget, is heading toward replacing the proposed Btu tax - which taxes various fuels according to the amount of energy they release - with a tax on transportation fuels. Talk on the amount of the tax has ranged from 3.5 cents a gallon to 7.3 cents for gasoline, diesel, and other transportation fuels.

But in the House, the gas tax "could be in trouble," said Rep. Pat Schroeder (D) of Colorado at a Monitor breakfast held yesterday.

"If you remember, last year [there] was a proposal to put a 5-cent-a-gallon tax and it was going to be for public works, and it did not pass," Representative Schroeder said. "So all along, people have been thinking about that, and the question is: If it didn't pass last year, and it was going to go directly into things people could see - into infrastructure, which everybody seems to agree is falling down - how's it going to pass now when it isn't going to be as direct and [we] see where it goes?"

Schroeder concluded: "So, I think we're a long way from seeing what the final formulation's going to be."

She still believes a Btu tax, which the House approved in its razor-thin, 219-to-213 passage of a budget, would be fairer. But the problem, she added, is that people do not understand it. "My favorite letter was, `I don't even have a Btu and you're gonna tax it.' "

Schroeder agrees that President Clinton did not do an adequate selling job on the Btu tax, but neither did the "enviros. They didn't get out and advocate for it."

In her view, the House is also partly to blame for the Btu tax's demise because it allowed a few industries to be exempt. "The equal-pain theory got to be not so equal."

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