1. The Gas Guzzler Tax Stacey Louie CHE 379 Dr. T.F. Edgar The University of Texas at Austin Dept. of Chemical Engineering (http://www.ucar.edu/communications/staffnotes/9712/CartoonCar.GIF)

2. Background Provision of Energy Tax Act of 1978 Has not changed since 1991 Manufacturer tax for low fuel economy vehicles (below 22.5 mpg) Tax disclosed on fuel economy label on new cars Only applies to passenger cars (does not include SUVs, trucks, minivans, or cars >6000 lb GVWR)

3. Gas Guzzler Taxes Tax receipts in 2005: $170.3 million

4. Vehicle Sales and Fuel Economy Total vehicle sales in 2006 = 16.7 million SUVs and Pickups 4.5 million SUVs 2.4 million pickups 44% of total sales Avg. fuel economy SUVs: 21 mpg Pickups: 19.5 mpg (http://cta.ornl.gov/data/tedb26/Edition26_Chapter04.pdf)

5. Policy Recommendations Change fuel economy categories Avg. passenger car in 2007 = 31.0 mpg Increase upper mpg bracket to at least 30 mpg for cars Increase taxes for lower mpg vehicles Update categories over time Include large vehicles Much lower fuel economy than cars $1300(4.5 mil SUVs) + $1700(2.4 mil pickups) = $9.93 billion = 58 times 2005 Gas Guzzler tax receipts Apply to energy R&D budget (only $1.6 billion in 2007)

6. References EPA. (2007, October 11). Gas guzzler tax and vehicles. Retrieved December 5, 2007, from http://www.epa.gov/fueleconomy/guzzler/index.htm National Highway Traffic Safety Administration. (2007, March). Summary of fuel economy performance: March 2007 (Rep. No. 480389). Retrieved November 7, 2007, from http://dmses.dot.gov/docimages/pdf102/480389_web.pdf National Science Foundation. (2007, August). Federal R&D funding by budget function: Fiscal years 2006-2008 (Rep. No. NSF 07-332). Retrieved December 5, 2007, from http://www.nsf.gov/statistics/nsf07332/ Oak Ridge National Laboratory. (2007). Transportation energy data book: Chapter 4 Light vehicles and characteristics (Rep. No. ORNL-6978). Retrieved November 6, 2007, from http://cta.ornl.gov/data/chapter4.shtml