NCPA - National Center for Policy Analysis

Return Of The Gore Energy Tax

September 13, 2000

Al Gore has long supported higher energy prices as a key part of his environmental agenda, and his surplus-busting budget plans virtually guarantee big tax increases, says Bruce Bartlett.

  • In its 1993 deficit reduction package, the Clinton Administration proposed a broad-based energy tax on the energy content of all fossil fuels, including oil, natural gas and coal.
  • It would have raised the price of gasoline 7.5 cents per gallon as well as prices for electricity and home heating oil.
  • An Energy Department analysis estimated the BTU tax, as it was called, would have cost a typical family $320 per year; private economists estimated the cost as high $500 per family per year.
  • The BTU tax was wildly unpopular even among Democrats, because it was highly regressive, taking more from the poor than the rich in percentage terms.

According to Bob Woodward's authoritative account in "The Agenda," Al Gore "virtually designed" the BTU tax and "spearheaded the fight" for it.

Treasury Secretary Lloyd Bentsen considered the tax to be "an administrative and political nightmare," according to Woodward. Until the BTU tax was killed, Gore fought for it as essential for the environment.

According to the Senate Budget Committee, Gore's announced proposals would increase federal spending $3.4 trillion to $4.3 trillion over the next 10 years. Should Gore's budget plans jeopardize the surplus and perhaps even bringing back deficits, the heaviest burden will fall on higher taxes, not lower spending. And a broad-based energy tax would be a very potent revenue-raiser indeed.

Source: Bruce Bartlett, senior fellow, National Center for Policy Analysis, September 13, 2000.


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