Climate Change Bill Calls for 50-cent Fuel Tax

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WASHINGTON - U.S. drivers would pay a 50-cent tax on each gallon of gasoline they pump to encourage less fuel use and cut greenhouse gas emissions, under draft legislation to fight global warming released on Thursday. "In order or reduce greenhouse gas emissions and make the planet safe and healthy for future generations it will take a significant investment from all of us," said Rep. John Dingell, the powerful chairman of the House Energy and Commerce Committee. "A fee on carbon emissions requires a tithe from all citizens and industries, but no one entity will be unfairly leveled with a devastating burden," Dingell said about his climate change proposal.

WASHINGTON - U.S. drivers would pay a 50-cent tax on each gallon of gasoline they pump to encourage less fuel use and cut greenhouse gas emissions, under draft legislation to fight global warming released on Thursday.

"In order or reduce greenhouse gas emissions and make the planet safe and healthy for future generations it will take a significant investment from all of us," said Rep. John Dingell, the powerful chairman of the House Energy and Commerce Committee.

"A fee on carbon emissions requires a tithe from all citizens and industries, but no one entity will be unfairly leveled with a devastating burden," Dingell said about his climate change proposal.

The fuel tax, which would also be tacked onto a gallon of jet fuel, would be phased in over 5 years and then adjusted for inflation.

Diesel fuel, which produces 20 percent fewer emissions than gasoline, would be exempt from the tax, as would biofuels that do not contain petroleum.

Before introducing a formal bill, Dingell said he is seeking feedback from the public and other interested parties on his current proposal.

There would also be a $50 tax on each ton of carbon produced from coal, petroleum and natural gas. This would also be phased in over 5 years and adjusted for inflation.

The money from the gasoline tax would go into the federal highway trust fund to pay for roads and mass transit. The jet fuel tax would be used to improve airports.

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Dingell's proposal would also phase out the mortgage interest deduction from taxable income on loans for large houses over 3,000 square feet and eliminate the tax benefit for homes over 4,200 square feet.

Dingell said while new bigger homes are more energy efficient than smaller ones built years ago, the so-called "McMansions" are usually located in the suburbs, requiring longer commutes that lead to dramatically more energy use.

To help lower-income families offset the higher tax on fuels, the federal earned income tax credit would be expanded to allow people to make more money before they are no longer eligible for the benefit.

Dingell's proposal was released as the Bush administration opened a two-day conference that brought together representatives from the world's biggest emitters to discuss ways to fight global warming.