made by the Federal-Aid Highway Act of 1959, including an increase in the motor- fuel tax from 3 to 4 cents a gallon.
The creation of the Highway Trust Fund resulted in the direction of the greater part of the Federal automotive tax proceeds into that fund but not all of them. Remaining as General Fund revenues were the proceeds of the 10-percent Federal excise tax on automobiles and motorcycles and the 8-percent tax on parts and accessories. There is also a tax of 6 cents per gallon on lubricating oil. Since only about 60 percent of the lubricating oil is estimated to be consumed in highway vehicles, this tax was ordinarily not as closely associated with motor vehicles and their use as are the taxes on motor vehicles, tires and tread rubber, and motor fuels.
Although nearly all of the income of the Highway Trust Fund was derived from excise taxes paid by highway users, certain amounts were derived from nonhighway sources. The largest such amounts were receipts from taxes paid on gasoline used in aircraft, motorboats, and industrial use, but in this case 2 of the 4 cents per gallon tax, if claimed, was subject to refund to the taxpayer. The proceeds of the tax on tires used off the highway (5 cents per pound) was also placed in the Trust Fund, as was the small amount of income obtained from automotive excise taxes paid by the Department of Defense on behalf of highway-type vehicles used entirely in off-highway service. Although such vehicles were exempt from motor-fuel taxes, payment of taxes on the purchase of trucks, buses, trailers, tires, and inner tubes was required.
Because Federal-aid expenditures for highways were now directly related to the income from certain highway user taxes, the equity of tax payments in relation to benefits and the highway costs occasioned by various types of vehicles had to be considered. The 1956 Act, therefore, called for a highway cost allocation study similar to those conducted by the States but on a nationwide basis in order to bring about “an equitable distribution of the tax burden among various classes of persons using the Federal-aid highways or otherwise deriving benefit from such highways.”
US-169 northeast of Paola, Kan., is a modern two-lane highway built on right-of-way acquired for a four-lane expressway. A second pair of lanes can be added in a few years when the traffic volume warrants it.
