President Obama will propose a $10-per-barrel oil tax in his 2017 budget to help fund a new clean transportation initiative, the White House said on Thursday. The president’s 21st Century Clean Transportation Plan calls for a 50% hike in spending on clean transportation infrastructure and reforms to prior investments made to reduce carbon pollution and cut oil consumption.
The White House said the new plan would provide $20 billion per year to help reduce traffic and expand public transit systems; $10 billion per year to help state and local governments change the way they plan transportation systems; and $2 billion per year in spending that includes R&D for electric and self-driving cars and clean aircraft.
The tax would be levied on oil companies and would be phased in over five years. Oil industry groups quickly denounced the plan — American Petroleum Institute President Jack Gerard said it would harm consumers and make America “less competitive.”
The proposal seems unlikely to gain traction in Congress. Many Republican legislators, including Speaker Paul Ryan, publicly declared the oil tax “dead on arrival” as news of the plan spread.
SEE ALSO: Obama Administration to halt new coal leases, review royalty rates
