Gas-guzzling vehicle owners pay the lion’s share of highway maintenance, but advanced technology is paving the way for eco-friendly cars to contribute more revenue through a new tax.
By requiring cars to be equipped with odometer spyware that will report to authorities how many miles are driven, government is looking to toss out the old gas tax for a new miles-driven fee.
“The Left is always pushing for more and more regulations, and more and more taxes. Now an insatiable Washington is looking to tax so-called green vehicles in a Big Brotheresque way,” said Robert Gordon, senior adviser for strategic outreach at The Heritage Foundation.
“The green chickens could be coming home to roost, and with them, the Left may have finally met a tax it doesn’t like,” Gordon said.
Sen. Kent Conrad (D.-N.D.), chairman of the Senate Budget Committee, is expected to make a recommendation later this year on whether the federal government should drop the gas tax and implement the Vehicle Miles Traveled (VMT) tax.
During a hearing earlier this spring, The Hill reported Conrad as saying that President Obama is asking for $556 billion over the next six years to fund federal transportation projects. Money from the Highway Trust Fund is also used to support mass transit, walkways, bike paths and scenic trails.
“Do we move to some kind of an assessment that is based on how many miles vehicles go, so that we capture revenue from those who are going to be using the roads who aren’t going to be paying any gas tax, or very little, with hybrids and electric cars?” Conrad suggested.
Draft legislation put forward by the Transportation Department would create a pilot program to tax drivers by the mile, although the White House has distanced itself from the effort.
“This is not an administration proposal,” White House spokeswoman Jennifer Psaki told The Hill in a separate article.
“This is not a bill supported by the administration. This was an early working draft proposal that was never formally circulated within the administration, does not take into account the advice of the President’s senior advisers, economic team or Cabinet officials, and does not represent the views of the President,” Psaki said.
A proposal in the Oregon legislature to create a VMT tax stalled in committee earlier this year after opposition by environmentalists.
However, that measure would have applied the VMT tax only to hybrids and electric cars.
Environmentalists opposed the legislation because they said it would be contrary to the incentive to buy fuel-efficiency vehicles, and that the technology required to collect the mileage information is an invasion of privacy.
“The idea of imposing VMT taxes … has raised concerns about privacy because the process of assessing such taxes could give the government access to specific information about how individual vehicles are used,” the Congressional Budget Office (CBO) said in its March report, “Alternative Approaches to Funding Highways.”
Some conservatives say gas taxes are obsolete, and suggest fees paid by those who actually use the service as a less invasive scheme to raise revenue.
“The main concern is that we have huge shortfalls in the trust fund that need to be addressed, and Congress is either unable, or unwilling, to raise fuel taxes,” said Marc Scribner, land use and transportation policy analyst for the Competitive Enterprise Institute (CEI).
Since 2008, the trust fund has borrowed $30 billion from the treasury to pay for road maintenance.
“The federal government spends far too much and taxes Americans to vastly excessive levels,” said Ryan Radia, associate director of technology studies at CEI.
“We don’t think the tax burden should go up, but the question is, ‘How are we going to fund the highway system?’ It’s better that those who use the highway bear the cost, not all Americans,” Radia said.
While drivers of eco-friendly cars would pay more taxes under the VMT system, it would result in lower taxes for low-income drivers who drive older car models that are not as fuel-efficient, and rural residents who drive pickup trucks, the CBO said.
Josh Culling, state affairs manager at Americans for Tax Reform, said, “Our friends on the Left are finally finding out that taxes are problematic.”
“There are a number of ways to justify fairness,” Culling said.
Also contentious is how the mileage information would be collected on individual cars. Oregon specifically rejected the use of a global positioning satellite (GPS) systems.
The CBO report said consumers might be more willing to share their travel information with a commercial source for collection, rather than a government agency.
Technology already available has the ability to collect data on location and travel time, which “could be used to reconstruct, or even monitor in real time, a vehicle’s travel,” the CBO report said.
“Government keeps trying to get more and more involved in our personal lives. In this proposal, they will be in the car with us, literally, when we drive,” said Josh Culling, state affairs manager for Americans for Tax Reform.