INDIANAPOLIS (AP) — Indiana House Republicans are proposing a tax increase in their roads funding proposal that’s an alternative to a rival plan proposed by Gov. Mike Pence.
House GOP leadership on Monday detailed the plan, which they say offers a long-term solution to paying for the state’s crumbling roads. It includes increasing the cigarette tax by $1 a pack and the gas tax by 4 cents a gallon.
That contrasts with Pence’s plan, which does not increase taxes, but offers only a short-term answer to infrastructure spending and relies on borrowing money and drawing down the state’s budget reserve.
The House GOP plan would increase cigarette taxes by $1 a pack, redirect sales tax revenues from gasoline sales to pay for roads and allow the state’s gas tax to increase with inflation.
The House measure would also allow local governments to increase taxes to pay for local roads.
South Bend Mayor Pete Buttigieg, a Democrat, applauded the plan.
“I am very encouraged to see a serious proposal from House Republicans that places the need for road improvements above political ideology,” Buttigieg said in a statement to the media. “We need better roads, and that means finding a way to pay for them. This plan identifies sustainable funding sources to make critical, overdue improvements in places like South Bend.”