State senators are sticking by their proposal to impose a 6-cent-per-gallon surcharge on gasoline companies, which, according to the Washington Post, “they characterized as a populist effort to make big oil corporations share the cost of improving state roads and transit systems.”
Gas companies “don’t mind sticking it to me and sticking it to every person in Virginia when we come up to that pump, and I don’t mind repaying the favor,” said Sen. R. Edward Houck (D-Spotsylvania). Majority Leader Walter A. Stosch (R-Henrico) said the tax is aimed directly at “profiteering” by the gasoline giants.
I would like to ask Sen. Houck what evidence he has that oil companies are “sticking it to him,” and I would ask Sen. Stosch what, exactly, does he mean by “profiteering”? Do they base their charges upon anything more than a casual observation of rising prices at the gas pump? What proof do they have that gasoline retailers — BP, Hess, Exxon, Shell, Marathon, Amoco, Chevron, Texaco and too many convenience stores to count — are circumventing the normal workings of a free market, in which prices fluctuate according to supply and demand? If they have evidence, they have not presented it.
One of two things would come of this legislation. First possibility: The oil companies pass on the tax to consumers, and the consumers get hosed. Second possibility: The oil companies cannot pass on the tax to consumers, their Virginia operations become less profitable, they are more reluctant to expand gasoline distribution and retailing capacity in Virginia in the face of ever-escalating demand… and the consumers get hosed.
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