US President Barack Obama to propose controversial oil tax plan to fund new-age transportation system
Obama announces plans to spruce up transportation system in an ambitious $300bn projectReuters

US President Barack Obama will propose a $10 (£7) tax on per barrel of oil – produced or consumed – to fund a new state-of-the-art, clean transport system. The White House said on Thursday that Obama will approach the Congress with the proposal (probably next week) for a multi-billion dollar of investment in driverless cars, mass transit, clean energy and high-speed railways.

Obama announced his plans to spruce up the transportation system in an ambitious $300bn project, all of which will be uncovered in his upcoming budget proposal. The Obama administration revealed its transportation budget on 4 February, via a White House memo titled President Obama's 21st Century Clean Transportation System.

The memo read: "A new approach to our transportation system can help to speed goods to market, expand transportation options, and integrate new technologies like autonomous – or self-driving – vehicles while at the same time reducing our reliance on fossil fuels, cutting carbon pollution, and strengthening our resilience to the impacts of climate change."

The bill, whoever, has slim chances of being passed by the Republican-led Congress. The plan would effectively increase fossil fuel prices, which in turn would lead to providing "a clear incentive for private-sector innovation to reduce our reliance on oil and invest in clean-energy technologies that will power our future".

The proposed plan reflects Obama's increasing engagement with alternative modes of transportation. The US Department for Transport had previously proposed a plan, outlining that it will invest $4bn in advanced technologies and work on introducing new regulations to ramp up the process of the getting driverless cars on American roads.

Similar to this plan, Obama's new transportation project proposes that the consequent oil tax be phased over a period of five years, to gently impact America's currently economy.