Gas tax

[SecondAttempt]

I have not seen this topic discussed on E-R since about 2008 so hopefully it is fair game. It was inspired by the carbon tax question but I did not want to usurp that thread.

What should we do about the gas tax given the proliferation of electric vehicles? I don't like taxes any more than the next person but I think gas taxes are probably the best structured. Road users pay taxes to use the roads and to a large extent what they pay is proportional to how many miles hey drive, vehicle weight, and hence damage they cause. Then the money is used substantially for road repairs.

But with EVs paying no taxes to use the roads it seems unfair. I've heard proposals at the state level to use odometer readings on EVs to calulate a tax annualy when registering. I don't think that is a good technical solution because most of the gas tax is federal, it does not solve the bulk of the problem because there is no federal vehicle registration.

So what do we do?

 

[JoPeter57]

As far as your numbers are concerned,
Federal tax is 18.4c per gal
Washington State (where I live) is 49.4c per gal

the lowest state per gal tax
Alaska at 14.98c cents per gallon,
Missouri 17.42c
Mississippi 18.79c

I don't know what these numbers mean other than most of the gas tax does go to the individ states

 

[Zathras]

Gas taxes used to be a pretty close approximation to vehicle weight and distance traveled.
It has become less and less so and is being broken with EVs.

Gas taxes, for road repair need to be scrapped for all vehicles.
In their place, a new tax based on vehicle weight and miles driven need to take it's place.

Having one tax for gassers, another for BEVs, another for PHEVs, another for HEVs and yet another for Fuel Cell cars just gets ridiculous.

One set of rules for all vehicle types.

 

[SecondAttempt]

Gas taxes used to be a pretty close approximation to vehicle weight and distance traveled.
It has become less and less so and is being broken with EVs.

Gas taxes, for road repair need to be scrapped for all vehicles.
In their place, a new tax based on vehicle weight and miles driven need to take it's place.

Having one tax for gassers, another for BEVs, another for PHEVs, another for HEVs and yet another for Fuel Cell cars just gets ridiculous.

One set of rules for all vehicle types.

I agree but it can sill get complicated. I live in Hawaii. Only a tiny fraction of Hawaii vehicles ever ouch a road on the mainland. So why should I have to pay to fix roads in Texas and Vermont for example?

But more directly to the point, if a state switched to a tax based on vehicle weight and miles driven, which makes sense to me, it's not clear how the feds would get their share, esspecially if every stste does it differently.

 

[Montecfo]

Biggest problem with gas tax is not electric vehicles (2 pct of vehicles maybe?). It is politicians raiding the highway fund for non-highway spending

That's an even tougher problem.

 

[SecondAttempt]

Biggest problem with gas tax is not electric vehicles (2 pct of vehicles maybe?). It is politicians raiding the highway fund for non-highway spending

That's an even tougher problem.

But we might be able to solve the EV issue. We'll never be able solve the problem of politicians!

 

[aja8888]

But we might be able to solve the EV issue. We'll never be able solve the problem of politicians!

Yeah, they we even present in the Roman Empire and look how that ended up!

 

[Mr. Tightwad]

The government is going to get their taxes one way or another.

Only question is how.

 

[ERD50]

Some conspiracy types (outside this thread) get all worked up over the govt knowing how many miles they drove that year. I think that's silly. In IL, you need to get an emissions check every two years, and your mileage is reported on the form. No big deal, IMO. A simple reporting system could be set up.

While mileage seems a fair basis, now throw in vehicle weight, and it gets messy. I'd imagine the damage from the typical passenger car is negligible compared to the heaviest trucks. So the trucks would pay nearly all the tax.

Though that may be just fine. Those truckers need to pass the cost onto whoever uses their services, and that seems appropriate. If you are house-bound and don't even own a car, you are still availing yourself of products that get to you by truck. Your groceries, clothes, furniture - practically everything had to come on a truck on its way to you (or a truck carries it away). So you should pay (indirectly) for keeping those roads maintained. If they weren't maintained, you couldn't get your stuff. So pay.

I think that's logical (or correct me if I messed up), but logic doesn't seem to get very far in cases like this.

-ERD50

 

[pb4uski]

... But more directly to the point, if a state switched to a tax based on vehicle weight and miles driven, which makes sense to me, it's not clear how the feds would get their share, esspecially if every stste does it differently.

The state could collect both the federal and state tax based on vehicle weight and miles drive when the registration is renewed and then remit the federal part to the feds.

Another problem that I see is collecting. With gas taxes the government collects a little at a time which makes it more affordable... but with a mileage/weight approach I assume that collection will be once a year... will those who live paycheck to paycheck be able to come up with the cash to pay it if a high percentage of the population can't come up with $400 for an emergency?

 

[Out-to-Lunch]

Yeah, they we even present in the Roman Empire and look how that ended up!

Well (to bring it back to the subject of this thread) some roads that the Romans built are still in use!

 

[SecondAttempt]

The state could collect both the federal and state tax based on vehicle weight and miles drive when the registration is renewed and then remit the federal part to the feds.

Another problem that I see is collecting. With gas taxes the government collects a little at a time which makes it more affordable... but with a mileage/weight approach I assume that collection will be once a year... will those who live paycheck to paycheck be able to come up with the cash to pay it if a high percentage of the population can't come up with $400 for an emergency?

Good point but the taxes really are not that high. Someone who drives 12000 miles a year in a 30 mpg car pays about $140 in a state where the tax is $0.35/gal. I understand that may be quite a bit for some people but they are already paying it and paying about $2000 a year for the gas. Obviously if you drive a lot more miles in a gas guzzler you pay a lot more but those are usually personal choices.

I'm not arguing for higher gas taxes, just trying to discuss what would be a fair way to collect them given changing vehicle demographics. I think we can all agree roads need to be maintained for everyone's benefit.

I learned today that Hawaii's gas tax is jus our general excise tax (GET) of ~4%. So it is no a fixed amount per gallon but varies with the gas price. A couple of other states do this. And interestingly, although the GET applies to almost everything, it does not seem to be charged on my electric bill! So EV owners are escaping the tax.

 

[SecondAttempt]

Well (to bring it back to the subject of this thread) some roads that the Romans built are still in use!

Off topic but I always loved this story about another Roman legacy:

The standard railroad gauge of 4 ft 8.5 inches was based on ruts in Roman roads in England caused by chariot wheels which were determined by the width of horse's butts (spacing of two horses standing next to each other).

That story is dubious but it seems to now be generally accepted that the rail gauge evolved from ancient cart wheel spacings.

I wonder how the Romans collected road taxes!

 

[savory]

Biggest problem with gas tax is not electric vehicles (2 pct of vehicles maybe?). It is politicians raiding the highway fund for non-highway spending

That's an even tougher problem.

As an advocate for improving on road bicycling infrastructure, many motorists complain bikes don’t pay their fair share. Frankly, no one pays their fair share. Then what was in the fund gets redirected.

 

[dixonge]

Only as EV trucks get to 5% of all trucks will the road wear issue need to be addressed. Commercial truck mileage is easily tracked and taxed.


Consumers, even if they do much less road wear damage, still pay a lot of the current tax. Tracking and taxing them will be more difficult. I guess annual inspections could record miles, so there ya go?

 

[MRG]

Since my state has an additional fee for EVS every year imagine this isn't a big problem that needs solving. Of course since my fully charged vehicle holds about $4.00 in fuel to support its 300 mile range I really don't care.

 

[1242Vintage]

Was involved with transportation infrastructure financing for a large portion of my career.

In the years before implementing a gas tax in our state we had a pilot project to gather mileage driven with a little gadget plugged into your car with the idea of taxing on a per mile basis. That pilot project died over privacy issues … no one really wants the govt to know where, when and how much you drive.

In my state EVs pay more annually for their vehicle registration. The rest of us with ICE vehicles painfully pay the tax at the pump.

 

[VanWinkle]

but we might be able to solve the ev issue. We'll never be able solve the problem of politicians!

+100000000000

 

[CRLLS]

Since my state has an additional fee for EVS every year imagine this isn't a big problem that needs solving. Of course since my fully charged vehicle holds about $4.00 in fuel to support its 300 mile range I really don't care.

Illinois has increased the annual registration fee for EV's over gas fueled cars in an attempt to offset this discrepancy. It doesn't account for miles driven but I think this is a fair compromise for now. Just because trucks may have a higher impact on road deterioration, I don't think we should overlook asking the electric family vehicle's to support the roads as some here might suggest.

 

[Zathras]

Illinois has increased the annual registration fee for EV's over gas fueled cars in an attempt to offset this discrepancy. It doesn't account for miles driven but I think this is a fair compromise for now. Just because trucks may have a higher impact on road deterioration, I don't think we should overlook asking the electric family vehicle's to support the roads as some here might suggest.

(Bold added)
It is the worse form of taxation. The lack of a mileage component is completely unfair.

ALL vehicles that use the roads should pay on miles driven, and weight of vehicle.

Government needs to figure out an equitable method of levying road taxes, and treat all vehicles the same.

 

[CRLLS]

While it may be "the worse form of taxation" as you say, it is a start. The electric vehicles have not paid a penny for road taxes up until now. Perhaps a more equitable form will come in the future.

Which weight of a vehicle would you use? The weight as it left the factory? A GVWR gross weight rating or GCWR? A 3/4 ton pickup used as a commute vehicle or a 3/4ton pickup driven by a scrapper would put a different road wear. How would you treat a tradesmen that adds tool boxes and supplies to their business vans? And what about trailers? With weight and miles driven, equity is not possible IMO. Even with the current gas tax. it is unequal. Consider 2 identical weight vehicles, one a 1980's vintage and a 2020's vehicles of the same weight pay different tax based on the fuel they use. There are inequities all over. Nothing is perfect. Until then I am happy that Illinois has done something.

 

[MRG]

While it may be "the worse form of taxation" as you say, it is a start. The electric vehicles have not paid a penny for road taxes up until now. Perhaps a more equitable form will come in the future.

Which weight of a vehicle would you use? The weight as it left the factory? A GVWR gross weight rating or GCWR? A 3/4 ton pickup used as a commute vehicle or a 3/4ton pickup driven by a scrapper would put a different road wear. How would you treat a tradesmen that adds tool boxes and supplies to their business vans? And what about trailers? With weight and miles driven, equity is not possible IMO. Even with the current gas tax. it is unequal. Consider 2 identical weight vehicles, one a 1980's vintage and a 2020's vehicles of the same weight pay different tax based on the fuel they use. There are inequities all over. Nothing is perfect. Until then I am happy that Illinois has done something.

+1

I was logging from 1974-1984. I know many tricks that were successfully used back then to avoid fuel tax. Would they work today? Probably, it's hard to tell if all that 255 gallons of diesel went into a skidder or a log truck. I'm pretty sure off road diesel runs just fine in a truck.

 

[SecondAttempt]

Which weight of a vehicle would you use? The weight as it left the factory? A GVWR gross weight rating or GCWR? A 3/4 ton pickup used as a commute vehicle or a 3/4ton pickup driven by a scrapper would put a different road wear. How would you treat a tradesmen that adds tool boxes and supplies to their business vans? And what about trailers? With weight and miles driven, equity is not possible IMO. Even with the current gas tax. it is unequal. Consider 2 identical weight vehicles, one a 1980's vintage and a 2020's vehicles of the same weight pay different tax based on the fuel they use. There are inequities all over. Nothing is perfect. Until then I am happy that Illinois has done something.

I would base it on the manufacturer's declared weight and not worry about tool boxes, passengers, etc.

Reminds me of going to DMV here in Hawaii to register my pickup a few years ago. There was a guy trying to register a car (Ford Focus) he had just shipped over from the mainland. The DMV system did not have a weight so they had apparently sent him to a local concrete yard to have it weighed. But the concrete yard told him they were no longer wieghing vehicles for DMV. The DMV workers went into full panic. There is literally no other scale on the island that could do this. They were on the phone calling all over trying to figure out what to do. Finally the guy says, "when you get your act together give me a call" and walked out!

So what if he gets stopped for no registration? Please understand that there are people here with "soveriegnty plates" who just refuse to register their vehicles because they do not accept the overthrow of the Hawaiian Kingdom. If they get stopped they make the county try them in the Hawaiian language (which is their right here) and this costs the county hundreds of dollars so the civil charge, which carries ~$50 fine, is almost always dropped. So if they press charges against him he will get off.

 

[SecondAttempt]

+1

I'm pretty sure off road diesel runs just fine in a truck.

I was wondering about that. I know there used to be farm diesel but can you still get it? I have not heard of i in over 30 years. I have not been much around farms bu I have been around stationary generators that are typically fed with the same diesel delivered to gas stations.

 

[Midpack]

But with EVs paying no taxes to use the roads it seems unfair.

The electric vehicles have not paid a penny for road taxes up until now.

Not quite true, and I am sure there will be a tax mechanism for EVs. As noted EVs make up 1-2% of road use, so it’s not significant yet and I may sure it’ll be resolved long before EVs are more common. Also noted, heavy trucks cause way more wear and tear on roads than personal vehicle. I’m not at all concerned that legislators will miss an opportunity to increase taxes and fees.

STATE-BY-STATE FEES

Here's a rundown of the states that currently charge electric-vehicle owners added fees, according to the National Conference of State Legislatures:
California: $100 annual fee for a zero-emissions vehicle. Starting in January 2021, annual increases will be indexed to the consumer price index.
Colorado: $50 annual fee for full-electric and plug-in hybrid (PHEV) vehicles.
Georgia: $200 annual license fee for “noncommercial alternative fueled vehicles,” including EVs, but not PHEVs (unless the owner requests an alt-fuel license plate). The fee is automatically adjusted on an annual basis.
Idaho: $140 annual fee for EVs; it’s $75 for PHEVs.
Illinois: $100 annual fee for EVs beginning July 1, 2019.
Indiana: $150 annual fee for EVs; it’s $50 for hybrids and PHEVs.
Michigan: $135 annual fee for non-hybrid electric vehicles weighing less than 8,000 pounds; it’s $235 for those weighing more than 8,000 pounds. The state charges hybrid owners an extra $47.50 and PHEV drivers an added $117.50. These fees are indexed to the state gas tax and would rise incrementally if it is increased.
Minnesota: $75 annual fee on EVs.
Mississippi: $150 fee on EVs and a $75 fee on hybrids. Beginning July 1, 2021, these fees will be indexed to the inflation rate.
Missouri: $75 annual fee on EVs, and $37.50 on PHEVs.
Nebraska: $75 annual fee on alternative-fuel vehicles, including EVs.
North Carolina: $130 on plug-in vehicles, including EVs.
Oregon: $110 annual fee on PHEVs beginning on January 1, 2020.
South Carolina: $120 biennial fee for EVs; it’s a $60 biennial fee for hybrids.
Tennessee: $100 annual fee for EVs.
Utah: $60 annual fee for EVs; it increases to $90 in 2020 and $120 in 2021. Hybrids are assessed a $10 fee that rises to $15 in 2020 and $20 in 2021. It’s currently a $26 annual fee for PHEVs that jumps to $39 in 2020 and $52 in 2021. In 2022 increases will be indexed to the consumer price index.
Virginia: $64 annual license for EVs.
Washington: $150 annual fee for EVs.
Wisconsin: $100 annual fee for EVs.

https://www.myev.com/research/inter...-charge-extra-fees-to-own-an-electric-vehicle