Giant New Tax Could Have Economy Running on Empty

May 24, 2017 by AFP

Energy is the basis of our economy. We need fuel and electricity for almost everything we do—which is why any increase in the cost of energy should concern everyone.

The BAT consumer tax is a cause for such concern, and your lawmakers in Congress are deciding on it right now. This 20 percent tax on imports would significantly increase energy prices and have a ripple effect across the entire economy.

The U.S. is a major consumer of crude oil, consuming one in every five barrels of crude produced worldwide. About half our energy needs are met with imported crude oil. Taxing those imports at 20 percent will send prices soaring—at the pump and almost everywhere else.

Estimates show that gas prices could increase by 30 to 40 cents per gallon as a result of the tax. Utility bills could increase for many Americans as well. And since low-income families spend the highest proportion of their earnings on fuel and electricity, they will be hit hardest.

Higher fuel costs mean higher transportation costs, so for goods that need to be moved from one place to another (hint: almost all of them), you can expect their costs to go up as well.

One estimate in the latest BAT report released by Freedom Partners and Americans for Prosperity suggests that the increase in fuel prices would lead to a 0.4 percent reduction in nominal GDP.

This means our entire economy would shrink based on the BAT’s effect on fuel prices alone. But remember: Under the BAT, the 20 percent tax on imports will apply to all industries. All told, this consumer tax could increase costs by nearly $2,000 for the average American family in just the first year, and send employment numbers tumbling to post-recession lows.

This should be a no-brainer. Tell your lawmakers that we just can’t afford this new burden, and to stand against the BAT.