The economics of the diesel fuel tax differential Paper presented at the 48th Annual Meeting of Highway Research Board HRB, Washington, D.C., January 1969.

The author discusses the proposed three cent per gallon tax differential for diesel tax that is designed to culminate the apparent tax advantage granted diesel vehicles created by the greater fuel economy of the diesel engine. The author notes that the application of the incremental-cost analysis method of determining the three cent differential has resulted in a serious misinterpretation of the basic cost-occasioned principal.