President Reagan decided yesterday not to increase the federal excise tax on gasoline for the next year and a half, shelving any consideration of it until preparation of the budget for the 1984 fiscal year, which begins Oct. 1, 1983.
Transportation Secretary Drew Lewis for months has advocated a 5-cent increase in the gasoline tax--which has been 4 cents for the last 23 years--to raise $4.4 billion for road and bridge repair and to provide about $1.1 billion in federal aid for maintenance of bus and subway systems.
In firmly ruling out the gas tax increase for the time being at a sub-Cabinet meeting yesterday, Reagan said he knew the need was critical but that he did not believe the administration could be talking about tax increases when it was trying to get budget cuts through Congress.
The nickel increase was supported on Capitol Hill and by many in the Cabinet, but is staunchly opposed by Treasury Secretary Donald T. Regan and other economic advisers. They reportedly were concerned that the tax would do little to reduce budget deficits and would ruin chances for imposition of an oil import fee that would raise an estimated $12 to $18 billion and would help bring down the deficit.
Lewis initially was rebuffed on the gasoline tax during budget deliberations earlier this year when Reagan, after appeals by the Chamber of Commerce and supply-side economic enthusiasts, persuaded him not to raise any taxes.
Later, however, after Lewis argued that the nickel increase would be less a tax and more of a users fee, Reagan gave him permission to "test the waters."
Highway contractors, mass transit systems and key committee chairmen on Capitol Hill had favored the proposal; the American Automobile Association and the Farm Bureau were opposed.