Does Country Need a 10-Cent Gas Tax Hike?

Two big names in the auto dealer world are divided over whether what this country needs is a 10-cent-a-gallon annual gasoline tax increase.

Michael Jackson, CEO of AutoNation Inc., the nation's largest dealership chain, says such an open-ended tax hike is “long overdue.” The federal gas tax has been 18.4 cents a gallon for a decade.

Increasing that would encourage consumers to conserve more fuel and prod auto makers to seek greater fuel efficiency, Jackson says at a Reuters automotive forum.

But Jack Kain, chairman of the National Automobile Dealers Assn., fears such a tax increase would hurt “a lot of people” who are financially challenged.

“Mike Jackson is a smart guy and sells more cars than I do, but if I suggested what he's suggesting, I'd be run out of my town on a rail,” he tells the Automotive Press Assn. in Detroit.

Kain owns Jack Kain Ford in Versailles, KY.