Ideology, Incidence and the Political Economy of Fuel Taxes: Evidence from the California 2018 Proposition 6

In 2018, California voters rejected Proposition 6, a ballot initiative that sought to repeal state gasoline taxes and vehicle fees enacted as part of the 2017 Road Repair and Accountability Act. We study the relationship between support for the proposition, political ideology and the economic burdens imposed by the Act. For every hundred dollars of annual per-household imposed costs, we estimate that support for the proposition rose by 3 - 9 percentage points. Notably, we find that the relationship between voting and the economic burden of the policy is seven times stronger in the most conservative tracts relative to the most liberal tracts. Since conservative areas in California and elsewhere tend to bear a higher burden from transportation and energy taxes than liberal areas, heterogeneity in the response to economic burdens has important implications for the popular support for environmental taxes and the ongoing policy debate about how to finance future road infrastructure.