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Page added on December 30, 2008

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This oil man favors a gas-tax hike

If the government raises the cost of driving, it surely would be bad for the energy business. So what’s the CEO of Western Refining thinking?

NEW YORK (Fortune) — It’s not often you hear a corporate executive advocate a tax on the product he sells, particularly not in the oil business, where opposition to gasoline taxes is fervent. But Paul Foster, the chairman and CEO of El Paso-based Western Refining, is (dare we say use the word after the presidential campaign?) a maverick.

Foster, 51, is a conservative Republican who has spent his entire career in the energy industry. He founded Western Refining (WNR, Fortune 500) in 1997 and in a decade built it into a $7.3 billion giant (No. 342 on the Fortune 500) that refines various fuels and also sells gasoline to consumers, mostly in the Southwest under the Giant and Mustang brand names.

Foster contends that the country needs to raise the federal gas tax significantly. He points out that, in real terms, we’re paying less than we did decades ago. (At 18.4 cents per gallon, the federal tax is currently 16% lower, adjusted for inflation, than it was in 1970.)

Foster argues that the levy should be increased, in steps, to $2 per gallon or more. He’s even willing to credit the Europeans with a good idea or two on this score, as he explains in an interview with Fortune.


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