Gas tax

[CRLLS]

Midpack, Thanks for the list. It is good to know that other states beyond Illinois are addressing this in a similar manner. My "up until now" comment meant recently. Of the 19 states listed, 5 of them are recent, as in the last 2 years. the other 14 do not list when they went into effect so difficult to discern. There are still 31 sates not on that list. I presume they don't get anything from EV's in those states.

I just discovered that diesel carries a 6-cent higher Federal Highway tax than gasoline. That is over and above the 18.4 cents for gasoline. Interesting to not that in addition, California has a 7% higher sales tax on Diesel than Gasoline. While Indiana has a 7% "use tax" on Gas and none on Diesel.

https://www.google.com/url?sa=t&rct...nited_States&usg=AOvVaw22_4kLRP77mvqXm-M7TzYh

 

[MRG]

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.

Sure you can. I mean home heating oil is the same as what trucks use. Ain't nobody paying road use taxs on their stick built house.

 

[pb4uski]

(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.

I don't agree. It is likely that we would spend more administering a system based on mileage in the interest of fairness than if it was just a fixed fee per vehicle.

It would be pretty easy to adjust based on vehicle weight, but miles is harder.

I guess we could self report odometer readings each period when we renew car registrations and they could do a true-up adjustment as part of the current registration fee and occasional spot checks... we self report miles driven for car insurance.

 

[Mark1]

+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.

I think they put dyes in off-road diesel and none in on-road diesel (or maybe the other way around?), and to get caught with the dyes in your truck tank is a pretty severe fine.

 

[ncbill]

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.

Reality is no passenger vehicle should be road taxed.

It's commercial vehicles that are causing the wear & tear to roads.

Gas tax remains highly regressive, however...increasing the tax per gallon on gasoline & diesel would be expensive for more rural & poorer drivers, which IMHO would have political ramifications.

 

[MRG]

I think they put dyes in off-road diesel and none in on-road diesel (or maybe the other way around?), and to get caught with the dyes in your truck tank is a pretty severe fine.

I think they do that today as when I was leaving the industry there was a lot of things done to force more compliance. However they have to see the fuel to test for dye. In the ten years I logged I've never been to a weigh station. They're pretty easy to avoid and most loggers avoid them. Can't weigh out in the timber so it's a real risk of fine to weigh there.

 

[Chuckanut]

(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.

Alas, the answer for that is to put a tracking device on your car to report all the miles you drive along with when and where you drive your car. It would need GPS since different states have different gas taxes. If I live in a big state like Alaska, it might be safe to assume all my miles are within my state. But, what about smaller states like Texas or New Jersey? Who else will want to milk those records for data on you? How will it be kept secure? (Data security doesn't seem to work well these days.)

If I drive 9000 miles in my home state and another 1000 in the neighboring state with lower gas taxes, I sure don't want to pay my home state's higher rates for that 1000 miles. And the neighboring state surely wants their money from me for causing wear and tear on their roads. So now I will have multiple states taxing me for driving on their roads. All of them keeping records of where and when I am, records that will probably be hacked and end up in the wild world of the Dark Web.

I can see this mess ending up at the Supreme Court as the justices try to fine tune things like Interstate Commerce, privacy rights, law enforcement issues and more.

Right now I pay an extra $75 a year in license fees because I own a fuel efficient hybrid. Mileage is not a factor. The $75 is to help build a charging network for EV's. But, my RAV4 does not plug in to any outlet. All the energy in consumes comes from gas. When I complained to my elected representative about that her reply can be distilled into four words - "We need the money". I don't trust her to fairly apply a mileage tax.

 

[Sunset]

I think gas tax should be abolished.

Replace it with a new extra flat State tax for each taxpayer. Everyone, even if they don't own a car/bike benefits from having a road for truckers to deliver food, police and ambulances to drive on..etc.

By just taxing every adult taxpayer, it's a super cheap way to collect the taxes. Right now even poor folks pay the gas tax so there would be no harm in the vast majority of cases.
By having some complex system, people can game it by turning back their odometer, using diesel taxed for home heating as auto fuel, etc..

 

[SnowballCamper]

I'll probably get shot for this....

I think the federal gas tax should go up (hasn't gone up in almost 30 years, and is per gallon). On average we surely get more miles per gallon (and therefore more road wear). I think increasing gas (and Diesel) tax is an incentive for more efficient and cleaner transportation.

I don't see any per mile tax replacing the fuel taxes...so just an addition to the existing taxes.

Alternatively, we could add a tire tax that would be more proportional to road wear.

In general taxes suck, yes I hate them too. But we've let the politicians rack up the debt to be $229,705 per taxpayer. Interestingly this is only $86,962 per person... so two taxpayers for every five people...interesting. https://www.usdebtclock.org

 

[Gumby]

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

I agree with your reasoning.

That leads me to support tolling on the highways, which take the brunt of the abuse and cost the most to maintain. You would think our General Assembly could figure out that the vast majority of the large trucks traveling through Connecticut and tearing up our roads are not even stopping here, so we should have tolls to account for the cost to our state. But no. Time and again they refuse to institute tolls and our roads get worse. Lobbyists and politicians will be the death of us.

I also think we should toll passenger cars on the highway, although the rate should be lower that the truck rate. I commuted 100 miles a day on the highway for years, so I know that it will cost commuters. But they are using more than their fair share of the roads that everyone pays for. For optimum resource allocation, those using the resource should pay for the resource and those who do not use it should not pay. I would be in favor of some sort of lockbox arrangement, so that the money paid in tolls is used only for the roads, because I know how that goes too.

Tolling does not even need to slow traffic anymore. You can drive the Massachusetts Turnpike from end to end and never slow down to pay the toll. You either have an EZ Pass or they take a picture of your license plate and send you a bill.

 

[CRLLS]

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

I don't know the answers to most of the problems. But I'll give you this to think about: Cars mfg'd earlier than 1996 are not currently tested biannually and are not getting their mileage reported. If mileage was part of the formula, there would have to be another way to collect that info.

Presently in IL, part of the state road tax from gasoline and diesel is distributed down to county, municipality and road districts on a prorated population basis. Large trucks would be paying for the secondary roads that are not oft travelled by the large trucks.

Many large interstate trucks have large fuel tanks and currently drive thru states with high tax rates. Their impact on the state roads currently go unpaid by them. Local delivery trucks, gravel trucks etc. are a different case altogether. I don't have a state level answer on either situation either.

Every way I look at it, there are problems making taxing somewhat equitable based on road wear.

 

[38Chevy454]

Alternatively, we could add a tire tax that would be more proportional to road wear.

Big truck tires *do* have extra taxes. Fedetal Excise Tax (FET) tax is applied on big truck tires. I know, my motorhome has big truck tires and I have paid that on new tires. Passenger car or light truck tires do not have FET.

 

[Rustic23]

When I worked in County Gov. (think 1998). We were approached by major auto manufacturer with a proposal of 100 cars with GPS. Cars would drive normal county business. A “tax” would e calculated monthly based on umber of miles driven on “class roads” thinsA. Freeways, B. City streets, C. County Rds. Etc.

We did not go into the program but the ideas of how to tax have been around for a long time.

 

[indiajust]

More complexity here than meets the eye.

Original fed gas tax was intended to pay for repairs only. Late 80's to early 90's they changed to allow all other transit projects to dip into self funded account. So mass transit projects and political log rolling was funded at the expense of interstate maintenance, eventually eating more than half the money allocated.

With algorithmic increases capped and congestion used to justify further mass transit transfers out... maintenance became a forgotten priority.

Primary issue is the imbalance of roads and population around the several states. Montana needs subsidized, they have way too much interstate for their population. True of much of the rural areas. Meanwhile urban areas used politics and put in way too many exits for suburban folks.

EV's are so lightweight, wear and tear is not much of an issue.

The best approach I have seen is to charge variable rate prices for peak usage. Stop charging for roads, start charging for guaranteed arrival times. Differential pricing is more productive and adds value for customers, rather than charging base rates for consumption.

Encouraging differential pricing works much better than talking about fairness and equity. I think the reason is that folks choose to pay the price and get the desired outcome.

Efforts toward one size fits all equity are plainly not suitable, or we would not have such wide variation among the states.

 

[indiajust]

Fundamental problem is similar to beer in a frat house. Individual marginal cost is below the actual cost and leads to overconsumption.

Gas was a decent proxy for both wear and tear and usage, since bigger vehicles use more gas, and more usage is more gas.

But with EV, special rates for trucks, and much money skimmed for mass transit pork, there isn't enough left to do maintenance. Might be a good candidate for blockchain distributed governance.

 

[aja8888]

EV's are so lightweight, wear and tear is not much of an issue.

You should check the weight of the full size EV's and you will find they weigh as much, if not more, that the same size ICE powered car. That battery is very heavy.

 

[a60dan]

The politicians are working on it…

https://apnews.com/article/fact-checking-907285011746

 

[Mr. Tightwad]

More complexity here than meets the eye.

Original fed gas tax was intended to pay for repairs only. Late 80's to early 90's they changed to allow all other transit projects to dip into self funded account. So mass transit projects and political log rolling was funded at the expense of interstate maintenance, eventually eating more than half the money allocated.

With algorithmic increases capped and congestion used to justify further mass transit transfers out... maintenance became a forgotten priority.

Primary issue is the imbalance of roads and population around the several states. Montana needs subsidized, they have way too much interstate for their population. True of much of the rural areas. Meanwhile urban areas used politics and put in way too many exits for suburban folks.

EV's are so lightweight, wear and tear is not much of an issue.

The best approach I have seen is to charge variable rate prices for peak usage. Stop charging for roads, start charging for guaranteed arrival times. Differential pricing is more productive and adds value for customers, rather than charging base rates for consumption.

Encouraging differential pricing works much better than talking about fairness and equity. I think the reason is that folks choose to pay the price and get the desired outcome.

Efforts toward one size fits all equity are plainly not suitable, or we would not have such wide variation among the states.

I think you should check the weight of EV's. Mine weighs 5100 pounds.

 

[azxracer]

Might be a good candidate for blockchain distributed governance.

What, exactly, does "blockchain distributed governance" mean and how might it apply to the issue of road taxes and electric vehicles?

 

[Oakster]

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?

The answer is going to be the User Tax, where you pay per mile you drive. The rate you pay will be adjusted for the weight of your vehicle. This will be the eventual answer and basically sets up roads similar to a utility (water or sewer etc) where the rates paid to use the road mostly pay for the upkeep. There are a lot of things to work out, such as sunsetting the gas tax so that a citizen is not charged both. How does one track the miles that are driven on state roads, vs county roads, vs city roads vs private property? It really does make good sense to go to a user tax, but it will take a good education campaign to get everyone on board because the public does not like it.

 

[Oakster]

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.

that is not really the weight that matters. passenger cars and trucks are a class, buses and commercial box trucks etc are a class, garbage trucks and 2.5 ton trucks are a class, semi trucks are several classes, based on axels. Vehicles fit into a category of What they could haul and are taxed at that rate. Compared to semi truck and trailers, garbage trucks etc, passenger trucks and a car trailer do little damage to the HIGHWAY system. That is comparing one car to one semi. If a semi does 20 times the damage to a road that a car does its easy to approximate rates. There are a lot more passenger cars though compared to semi trucks.

 

[Oakster]

I'll probably get shot for this....

I think the federal gas tax should go up (hasn't gone up in almost 30 years, and is per gallon). On average we surely get more miles per gallon (and therefore more road wear). I think increasing gas (and Diesel) tax is an incentive for more efficient and cleaner transportation.

I don't see any per mile tax replacing the fuel taxes...so just an addition to the existing taxes.

Alternatively, we could add a tire tax that would be more proportional to road wear.

In general taxes suck, yes I hate them too. But we've let the politicians rack up the debt to be $229,705 per taxpayer. Interestingly this is only $86,962 per person... so two taxpayers for every five people...interesting. https://www.usdebtclock.org

The problem with a gas tax is that the government is doing everything possible to reduce the amount of gas burned. The government mandates better fuel economy from cars (hurts the gas tax and road maintenance), the government is mandating a switch to electric vehicles (hurts the gas tax and road maintenance). The government is pushing people to use transit where possible (hurts the gas tax and road maintenance). The government understands that it is cutting its own income, so rest assured, a change in collection for road maintenance is coming.

 

[CaptTom]

I'm going be a contrarian here and say I never thought fuel taxes, tolls or any "user" fees were a good idea to fund roads.

I think it's disingenuous to say "let the user pay." Everyone uses roads, whether we drive on them or just buy the things that other people transported over them.

Transportation infrastructure is one of the few things that I think should be funded by government, out of general funds. The better the roads (and railroads, and airports, and seaports) are, the better our economy - our whole society - works. We ALL benefit.

We have enough ways to collect taxes now. We can argue about which ones are the most "fair," but presumably that's the goal. Just set them at a level which can support our infrastructure and get out of the way.

 

[SecondAttempt]

I think it's disingenuous to say "let the user pay." Everyone uses roads, whether we drive on them or just buy the things that other people transported over them.

I agree with you that everyone uses roads but gas taxes used to do a reasonable job at proportionally charging various users. Semi trucks paid much more because of their low gas mileage. And they could pass it on to consumers in the form of higher freight fees. But no sense in debating the past. That system is now broken with even electric semi trucks in the works.

I guess the problem with making road maintenance a general government obligation is that I would worry that a new tax is added to pay for it just to divert existing taxes to something else. Politicians tend to do that!

 

[CaptTom]

I guess the problem with making road maintenance a general government obligation is that I would worry that a new tax is added to pay for it just to divert existing taxes to something else. Politicians tend to do that!

Very true!

In my ideal world, the gubbment would tally up all their expenses and figure out everyone's fair share. Of course there would be some heated debate about how to calculate everyone's fair share. That's what we have elected officials for.

But in the end, we'd each get one tax bill, due on a given day of the year.

That day would also be election day.

I suspect this would solve a lot of our problems.