Letters to the Editor
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Bad stats ...
The study is titled "$2.00 Gas! Studying the Effects of a Gas Tax Moratorium," by Joseph J. Doyle Jr. and Krislert Samphantharak. Download the PDF here. The authors concluded that "the suspension of the 5% sales tax led to decreases in retail prices of 3% compared to neighboring states. And when the tax was reinstated, retail prices rose by roughly 4%."
This seems a GREAT example of completely misleading statistics. Unless I am badly mistaken, a 5% tax on gas means that 5% of the Illinois price for a gallon of gas will be added to that price. However, the quoted study doesn't address how much the price of a gallon of gas in Illinois changed relative to the previous price of gas in Illinois. Instead, it says the removal of the tax led to a drop of "3% compared to neighboring states." Thats comparing apples and elephants, especially with no information about the difference in prices across states prior to the removal of the tax. If the 5% tax was removed in Illinois, and the savings passed on to the consumer, then the price of gas in Illinois would have dropped 5% relative to the price at the pump before the tax was removed. There is no evidence that happened, nor is there any evidence from this study that the price of gas in Illinois dropped AT ALL relative to the price at the pump prior to the removal of he tax. How other states priced their gas isn't really relevant to the discussion, as far as I can see ... the only relevant comparison is the price of gas at an Illinois pump before and after the removal of the 5% tax ... but I don't see anything in this study that reports on that comparison. That leads me to believe that these statistics are being used to misdirect readers to a conclusion that simply isn't warranted.