‘As fuel taxes plummet, states weigh charging by the mile instead of the tank.” That was the headline of a recent AP story, which should scare freedom-loving citizens everywhere. And you can place the blame squarely on government-subsidized EVs for this terrible new development.
The background is that state and federal gasoline taxes aren’t raising “enough” money these days to pay for roadway construction and maintenance. And a big reason for the growing shortfall is the increase in electric vehicles.
EVs get massive tax subsidies to convince people to buy them, but their owners don’t pay gasoline taxes, for the obvious reason that they never have to fill up. The more EVs on the road, the less revenue the gas taxes raise.
So the policy geniuses in Washington have a solution: Impose a per-mile tax.
Some states are already experimenting with “vehicle miles traveled” taxes, and the $1 trillion bi-partisan infrastructure bill includes $125 million for state and local pilot programs to test a national VMT fee.
A VMT sounds reasonable, right? After all, every driver imposes costs on roadways. And a mileage tax would capture all drivers, no matter what fuels their cars.
But look more closely, and the VMT tax is perhaps one of the most insidious tax ideas ever devised.
To start, a VMT tax would be incredibly complicated and costly to impose.
The gas tax is simple. A relatively small number of large fuel suppliers pay the tax, the costs of which are then passed on to retailers. But by definition, a VMT means collecting money directly from hundreds of millions of owners of hundreds of million cars. How?
One idea is to force motorists to have their odometers checked regularly, where they’d then be assessed a fee. But that would simply encourage widespread odometer fraud, which is already a problem. The National Highway Traffic Safety Administration estimates that more than 450,000 cars are sold each year with false odometer readings. You’d also need an army of IRS agents to audit the millions of odometers.
Another option is to use an electronic-toll-style-collection system, which would require every car to come with a transmission device. Still another is to put GPS devices in every car, to track each car’s movement.
But as the Government Accountability Office noted, “launching and operating a system to collect fees from 230 million U.S. passenger vehicles is expected to greatly exceed the current costs of collecting federal fuel taxes.”
That means that a huge portion of the new tax would go to the overhead cost of collecting the tax before a dime could be spent on roads. How much would it cost?
The Congressional Budget Office figures that installing an electronic-toll-type system would cost $56 billion — just to cover the interstates, which account for about 2% of the country’s more than 4 million miles of roads.
The American Transportation Research Institute found that replacing the fuel tax with a VMT tax that uses GPS devices “could result in collection costs of more than $20 billion annually – about 300 times higher than the federal fuel tax.”
Worse, a GPS system would open a Pandora’s box of new government intrusions.
It could, the GAO noted, lead to “variable pricing programs” that “charge drivers different rates based on the type of road or the location of travel.” But it could also vary the tax based on the kind of car you drive, how you drive, what time of day you drive, or any other behavior the government wants to discourage.
It would, in short, let government bureaucrats “politicize the way we drive by playing favorites,” notes Heritage Foundation researcher David Ditch.
There are also some inconvenient constitutional issues with a mandatory federal GPS tax collection scheme. The Supreme Court ruled in 2012 against a federal GPS tracking program, saying that it amounted to an unreasonable search and seizure of evidence.
Then, of course, there’s the fact that a VMT would almost certainly be added on top of the gas tax, not as a replacement. Climate alarmist view the gas tax as a sin tax and will never let it go.
If this monstrosity comes into being — and drivers should do everything they can to make sure it doesn’t — you can thank all those preening electric car owners for foisting it on the rest of us.
— Written by the I&I Editorial Board
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