By on June 26, 2013

Credit our sorely missed EIC/Editor Emeritus Ed Niedermeyer for being well ahead of the curve. Back in 2011, Ed told me about how the rise of fuel efficient vehicles would create a revenue shortfall for the federal Highway Trust Fund, and that would lead the government to look at implementing all sorts of unpleasant things like a Vehicle Miles Traveled tax. Guess what Ray LaHood is proposing? You guessed it.

This isn’t the first time LaHood has proposed a VMT either. Back in 2009, he floated the idea as an alternative to raising the gas tax, which provides funding for the Highway Trust Fund, which is used to help maintain America’s roads. Now, LaHood is apparently telling the public that it’s in their interest to push the idea, according to The Detroit News

“Eventually people in the communities are going to persuade their members of Congress: We’re willing to raise taxes, we’re willing to pay tolls, we’re willing to go to vehicle miles traveled because we want better roads, better bridges,” LaHood said.

The big problem is that as Americans drive more fuel efficient vehicles, there is an increasingly large funding shortfall. There hasn’t been a raise in the gas tax since 1993, and Congress has spent $18.8 billion alone just to cover the shortfall for 2013-2014.

Last year, Congressional Budget Office estimated that to meet future highway needs between 2012 and 2022, the trust fund would need another $110 billion in funding. GAO says Congress could either hike gas taxes to 31.6 to 46.6 cents a gallon to fix the roads, or impose a 0.9-cent to 2.2-cent per mile tax on all travel.

The idea of a VMT, especially one tracked by GPS, is one that leaves civil libertarians in a cold sweat at night. Sources in DC tell us that a VMT essentially declared it a non-starter, not just for civil liberties reasons, but that the ROI would not be enough to justify implementing it. Nevertheless, a GAO report essentially endorsed a VMT scheme that could use GPS or other wireless transponders or prepaid “miles” indicated by a sticker on a vehicle’s windshield. Given how much the idea of the automobile is tied into the notion of personal liberty and freedom of movement, it’s hard to imagine this being acceptable to a vast swath of the American public. But something’s gotta give.

As Niedermeyer’s original report states, an increase in the gas tax (which occurred regularly from 1956-1993) is an inevitably, and the most sensible option as well. Though it would cause a hit to people’s pocketbooks, it would be the least intrusive option from a personal freedom standpoint, not to mention it would provide the requisite funding to keep America rolling.

Another side effect of a gas tax hike would be the increasing redundancy of CAFE. Rather than incentivizing auto makers to build hybrids, plug-ins, small displacement engines and increasing numbers of crossovers and trucks (to get around various CAFE loop holes), a gas tax hike would incentivize more fuel-efficient vehicles, no matter what propulsion system they used. Even Bob Lutz is on board with said logic

You either continue with inexpensive motor fuels and have to find other ways to incentivize the customer to buy hybrids and electric vehicles, such as the government credits. Or the other alternative is a gradual increase in the federal fuel tax of 25 cents a year, which in my estimation would have the benefit of giving automobile companies a planning base, and giving families that own vehicles a planning base. Every time gas prices go back down, everybody starts buying big stuff again. Gas prices go up a buck, the big stuff is unsellable and everyone wants small cars. Go figure. It’s like the collective memory is about three weeks long. We can’t run a business that way.

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111 Comments on “LaHood Calls For VMT, New Taxes To Raise Funds For Infrastructure, As Gas Tax Runs Dry...”


  • avatar
    KixStart

    The rise of what fuel-efficient vehicles?

    If I recall correctly, the top two best-sellers are still the F-150 and the Silverado. Only one hybrid model sells into 5 figures every month and hybrid represent less than 4% of the market.

    If gas consumption has decreased in the last few years, it’s likely still mostly on acount of the recession.

    • 0 avatar
      J.Emerson

      All vehicles in all classes have become more fuel efficient, not just hybrids and small cars. A V6 F-150 is rated at 17 city/ 23 highway; the V8 is 15/21. In 2000, it was 15/19 for the six and 13/18 for the V8. Look at any large truck line from the late 90′s to now and you’ll find substantial improvements in economy. The decrease in gas consumption is a permanent structural change moving forward.

      • 0 avatar

        Not only that, but mid-size passenger cars as well. The next generation of trucks will be more fuel efficient as well, what with aluminum construction, a further move towards V6 engines etc.

        • 0 avatar
          J.Emerson

          Yes. It was considered acceptable to get an average in the mid-to-low 20′s from a family sedan all the way up until the early 2000′s; we get that kind of mileage out of fullsize trucks now.

      • 0 avatar
        KixStart

        If you go look at trucks on Fuelly.com, you’ll see that the real-world difference in fuel economy between a late ’90′s truck and a contemporary truck is quite small. We’re not buying gas and paying the tax based on the EPA sticker, we’re buying gas and paying the tax at the pump, based on what actually happens on the road.

        Further, are trucks as a percentage of the fleet mix up overall?

        Peak year for revenue seems to have been 2008 (Tax Policy Center). This is related to vehicle miles driven, which appears to have peaked in… 2008 (DOT). Revenue since has been close to 2008 revenues (looks like it’s headed back up and the recent record F-150 sales should help that along).

        The reason this is becoming recognized as a problem has little to do with the slight decrease in revenues, it has much more to do with the increasing backlog of highway and bridge maintenance that’s been ignored for decades. We’re approaching the point where we can’t kick the can down the road any more and it’s time to pony up.

        • 0 avatar

          I think both sides have a point here. We are driving less we also have been raiding the highway fund for years (look up Connecticut Gad tax for a perfect example)But looking at fuelly at the top selling cars Camry-f150-civic they all have made at least 5-10 percent gains in the last15 years, while small that does have some effect as I assume the average fleet MPG will be up as a whole.

        • 0 avatar
          Lorenzo

          The use of gas tax funding for bike trails, subways and bus subsidies, among many other diversions, is the reason for the maintenance/replacement backlog. In Cali, gas tax money is paying for ferry service in the San Francisco bay area, and Cal-train/Coaster train service in the coastal zone. Why should the road users pay the tax twice, when politicians refused to find a tax source for their pet projects and subsidies? Let them stop raiding the gas tax and replace the diverted road use taxes with money from the general fund or other programs.

  • avatar
    ash78

    The bottom line is that driving, at least for most of the US, is like phone service — most of us are more willing to pay a flat fee for unlimited service. The gas tax is the next best thing, and I’m in favor of that in lieu of any sort of tracking system.

    Maybe people who travel toll roads every day have a different perspective, but I only see a toll road about once a year on vacation.

    Another pretty smart idea I once read (and adapted) was to peg the price of gas at, say, $4 everywhere. Then allow the states and Feds to collect taxes on the difference between the market price and $4. Consumers get a predictable price, station owners have to compete on fuel quality and service, and the government has a built-in incentive to reduce the speculation premium and to keep the true market price of gas as low as possible (thus increasing their take).

    That’s the only semi-communist idea I’ve thought was good in a long time.

  • avatar
    J.Emerson

    Eventually, we’ll bite the bullet and raise the gas tax. The VMT has too many disadvantages to be politically or economically viable, and the gas tax is more equitable anyway. But if we’re going to raise fuel taxes, diesel should get hiked more than regular gas if we’re really going to be fair about who has the most responsibility for road maintenance.

    • 0 avatar
      KixStart

      I presume you mean normalize the diesel tax to the point where a vehicle that’s available in either gas or diesel form would end up paying about the same tax either way? I’m guessing diesel has an advantage right now?

      I can see a downside to that… it should probably be phased in.

      We’ll have another problem if CNG takes off.

      • 0 avatar
        scwmcan

        No I think he meant raise the taxes to increase the cost of diesel so that large trucks would pay more in fuel taxes as they ” are more responsible for road damages”. While this is true ( most likely anyway) the problem with penalizing them more is that in the end we are still the ones that end up paying it ( in the form of higher costs for everything). I believe that in many states diesel is already taxed higher than gasoline anyway accounting for much of the difference in the two currently.

    • 0 avatar
      B4U Caprice

      Our government does not need one more penny(expanded or additional tax) from we the people. These bastards don’t suffer from a revenue problem. There is a better way to pay for “road maintenance” or a least save money to pay for it.

      We need to stop all these unjustified, never ending wars. You know, the ones where we blow up other countries roads and infrastructure only to turn around and rebuild them at our expense? Stopping the unnecessary wars, nation-building, and intervening in foreign affairs alone will save billions if not trillions. Transfer the savings to maintaining our roads and infrastructure.

    • 0 avatar
      Dr. Kenneth Noisewater

      Gas and diesel taxes need to go up, but commercial trucks are already separately assessed use tax by weight.

      Gas, diesel and road taxes at all levels also have to stop being raided for general funds or other functions of government before there’s any talk of raising those taxes.

  • avatar
    Da Coyote

    Someone able to get the figures should check this out, but I strongly suspect that 1) income from gas taxes greatly exceeded the requirements in the early years, 2) that excess income was not saved, but squandered by the bottom dwelling scum (otherwise known as our congresscritters)- critters from both parties.

    Sooner or later, folks, we’re gonna have to tell this collection of sewage slime to shove their taxes up their smelly Obamas.

    Perhaps we should boil the critters and repave our roads with their scummy carcasses.

    • 0 avatar

      Really? You think back when we were building from scratch all the paved roads now in the country that we had a surplus of money to do it? Also, need I remind you of all the half wit idiots who got good paying jobs building the roads that the gas taxes paid for?

    • 0 avatar
      J.Emerson

      The federal highway system has never been a self-sustaining entity, nor did gas tax revenue cover the cost of building it in the first place; it wasn’t even close. When Eisenhower announced it, it was the most expensive public works project in modern history. It still is.

  • avatar
    marshall

    This is a perfect case for “you go first”.

    Secretary LaHood should deploy this tracking on all cars in the federal government, and report back to Congress on how accurate it has been, how much it has cost, etc.

    • 0 avatar
      J.Emerson

      Many federal agencies already employ tracking systems on their fleet cars for liability and accountability purposes. So maybe you should write to him and suggest it, because I’m sure you were being serious.

      • 0 avatar
        chuckrs

        Would there be any chance of the implementation government-wide being declared anything but a stunning success? These are the people who think adding layers of government oversight to our broken healthcare system will actually decrease costs and/or deliver better care. Its religious, not rational, and the conclusion is, pardon me, preordained.
        Increase the gas tax and use it solely to repair the infrastructure. No harebrained schemes for high speed rail in CA and WI, no parking garages to ‘decrease congestion’, no bike paths, etc. If the states want to do something different, fine as long as I don’t live there.

  • avatar

    So by floating a mile traveled tax that would be ridiculously unpopular and expensive to implement and enforce they are going to get Fox News and the general public in a tizzy, then compromise and just raise the gas tax like they should have every year since the last time they raised it?

    Would the miles traveled tax also have different rates for different types of vehicles? A motorcycle, a Fiat 500, a Honda Accord, a F150 Crew Cab Dually and a Kenworth Cab pulling 2 dump trailers full of gravel don’t cause anywhere near the same wear & tear on the infrastructure. A tax on the fuel they use is not only a tax on the number of miles each drives, but a tax on the size and damage they do to the roadways.

  • avatar
    ajla

    The big problem I see with the gas tax is that it doesn’t hit EVs and CNGs.

    Maybe not a big deal today, but it could be an issue soon.

    • 0 avatar
      jkross22

      Let’s end the subsidies for hybrids and electrics and use that money for the highway funding.

      • 0 avatar
        gslippy

        I’m not a EV subsidy fan, but let’s do the math:

        15 million car sales
        0.5% of them are EVs
        = 75000 EVs

        Federal subsidy is $7500/car (max).

        Killing the subsidy would generate $562 million, which is 3% of the shortfall. Yeah, that’ll solve it.

        • 0 avatar
          Hummer

          Well we spend billions each year for religious government belief in Global Warming, for a supposed human impact of about 1%

          3% should get the ball rolling quite well

          • 0 avatar
            Luke42

            Climate science is not a religious topic. You have access to Google Scholar. Read the freaking papers. At least the ones on PLOS.

            Also, what billions are you referring to? We aren’t really doing much to mitigate global warming / climate change. Unless you count disaster relief (which is a debatable point). But you have to take disaster relief out of your total, since you don’t think climate change has any impact.

        • 0 avatar
          wsn

          0.5% of cars contributing 3% of the short fall. 6x their due share. Not too bad.

    • 0 avatar
      Chicago Dude

      The federal excise tax on CNG is the same as gasoline – 18.4 cents per GGE.

    • 0 avatar
      gslippy

      My Leaf is rated at 99 MPGe. My PA state inspection will show that I’ll probably drive it about 9000 miles this year, which would be equivalent to 91 gallons of gasoline.

      In Pennsylvania, the gasoline tax is $0.51/gallon, so if they want my 46 bucks, I’ll pay it. BUT, that’s NOT what they want. As CAFE goes up, revenue will drop. They really want much, much more, and not just from EV drivers.

      However, with EVs only comprising 0.5% of car sales, taxing them for equivalent gasoline usage will generate almost no revenue.

      • 0 avatar
        redav

        If EVs ever become more than just a niche, perhaps we will see an electric tax. It may be small enough that people don’t realize it’s there, but simultaneously generating beaucoup bucks because so much electricity is used overall.

        From wikipedia: US electric consumption = 3,886,400,000 MWh/yr
        Using $0.001/kWh, that equals $3.88B.

    • 0 avatar
      SoCalMikester

      Why couldnt gas pumped at CNG stations be taxed? Why isnt it? Same with for-pay charging stations?

  • avatar
    TMA1

    Why is the most common solution to tracking mileage some form of transponder or GPS?

    Does your state have annual emissions/safety inspections? Take your car in, they record the mileage. Take it back the next year, record the mileage again. Send you a bill in the mail for the tax owed. Not that difficult.

    • 0 avatar
      bjchase55

      Not every state does, and not every state is yearly. Also, what if I traveled out of state? If I live in Georgia and traveled 12k miles, but traveled to Florida for 1k of those, shouldn’t Florida get 1k worth of VMT instead of Georgia getting 12k worth? Your idea has merit and like any idea there are pros and cons. Another idea I have seen is when renewing your license plate tags. But a lot of that can be done by mail so how would one record the milage that way? Pros and cons.

      • 0 avatar
        KixStart

        That could be done. You would simply fill in a box on the registration form and pay up. When the car changes hands, you have to true it up and pay for any missing miles if you’ve been fibbing all along. Or the buyer would, which would annoy him severely.

      • 0 avatar
        TMA1

        I’m aware that not every state has those kind of requirements. But they do seem to be moving towards it. Otherwise, I think most states would be recording mileage when the car is bought and sold as the title is being transferred. Though that could be a pretty hefty tax bill for anyone to pay all at once.

        As for the states, I thought this was an alternative to a national tax. So it wouldn’t matter where you drive. I’d be surprised if states are getting road funding that is proportional to the gas tax collected in that state. I think it’s more likely that gas taxes being collected in Texas are ending up in Minnesota potholes. So the federal government will still be doling out the cash as it sees fit.

      • 0 avatar
        ezeolla

        This is for the federal gas tax, not state gas tax. It all goes to the same place

        And the feds could do the same thing they did with alcohol; take something away from the states unless they do inspections every year (I am not saying I approve this, it’s just what they would do)

      • 0 avatar
        Luke42

        I’d rather pay the extra tax then have my car’s location tracked. Period.

        I can see situations where a business located near a state line might choose differently, but that’s a different thing.

        But I’d rather pay in-state taxes for my out-of-state adventures before giving my privacy.

        Or, better yet, just tax the snot out of gas, repeal CAFE and let the market take care of the rest (now that it has a proper price signal and public goods (like roads and bridges) are paid for).

    • 0 avatar
      redav

      TMA1, I agree that is a far simpler solution.

      However, I believe GPS always comes up because states & munis want to be able to charge ‘congestion fees’ for driving on certain roads like city centers and driving during high-traffic times. They also want to catch out-of-county or out-of-state drivers who enter their borders.

      As with many things, they propose the plan based on certain ‘needs,’ but intend for it to work in a very different way.

  • avatar
    bjchase55

    I’m willing to pay my share where appropriate. I’d be more willing to pay my share if the government showed any ability to actual manage the money well. But track my car to determine the milage? Umm…lol..hellz no. I think parkwood60 is on to something. Float the least desireable than propose an alternative. Although the alternative isn’t that desireable, comparatively it would look better.

    • 0 avatar
      KixStart

      The biggest problem with highways is the inability to pay for required maintenance. That seems to be beyond any “ability to actually manage the money well.” The bad management is only in kicking the can down the road for many years.

  • avatar
    mkirk

    Even if this is a good idea (not saying that at all), I can’t imagine a worse time to try to push some sort of GPS tracking for every car on the road on the American people in light of the IRS/NSA/Scandal of the week. This is DOA.

    And as to raising the gas tax, keep in mind…It is a regressive tax. The poor don’t drive that new Prius…They are likely rolling in a late 90′s Buick or something along those lines at this point and as such will be hit harder by a gas tax hike.

    Perhaps a solution would be to take a realistic look at what we need to money wise to fix this and simply levy a fee at registration time and implement serious fines for those who fail to register. Just thinking out loud on that one.

    • 0 avatar
      wsn

      You can’t subsidize the poor in every form of tax. It’s just inefficient. Make the gas tax flat and subsidize the poor via income tax deduction or health care.

    • 0 avatar
      28-Cars-Later

      This is the most telling, IMO:

      “Since it hasn’t been raised in 20 years, the gas tax’s purchasing power has dramatically declined. (It would be about 29 cents per gallon today if it had been indexed to inflation, according to the CBO.)”

      So the gas tax, and thus our currency, has lost 38% of its value in only *20 YEARS* (0.18/0.29 = 0.6206 or 62%, correct my math if I am wrong please). Its time for Washington to go to the mattresses and end a few bloodlines in charge of a certain bank.

      http://www.governing DOT com/blogs/fedwatch/gov-highway-trust-fund-future-jeopardy-infrastructure-transportation.html

      • 0 avatar
        redav

        Put it into a different context: that averages to an inflation rate of 2.4%/yr.

        I’m no economist, but I understand that in a modern economy it isn’t possible (or even desirable) completely elimonate inflation. That level of inflation isn’t exactly terrible, and it’s possible that pushing it lower than that would have worse side effects.

  • avatar
    Heino

    With hybrids and EV’s the Feds have a $7500 rebate, the states sometimes pile on too. The idea is a reduction in CO2 emissions. But then to worry about funding? Very typical problem, we want the best roads, military, schools, safety etc., but don’t want to pay for it.

    • 0 avatar
      mkirk

      Good point…so how about starting with revoking the rebates and put that money into the highway fund.

      • 0 avatar
        gslippy

        See my post above – such a move would provide only 3% of the shortfall, but would destroy the low-end EV market. The Model S would still sell, though.

        • 0 avatar
          Les

          This implies..

          A) That the logical decision to eliminate out-pourings of money Into vehicles that by design reduce tax revenue is countered by, “Oh but it’ll only put so much back into the till.”

          B) The low-end EV market is worth saving.

  • avatar

    Its about time that people in the USA had a Tax like we have HST combinaton of Provincial and Federal Tax on just about everything except some Foods and some Clothes, that’s what makes our Gasoline so high as compared to the USA.

    • 0 avatar
      CJinSD

      Envy is a stinky perfume.

    • 0 avatar
      99GT4.6

      I hate the HST as much as anyone but why not advocate reducing our tax instead of increasing theirs?

      • 0 avatar
        danio3834

        +1. I think CJ is onto something, misery likes company.

      • 0 avatar
        wsn

        @ 99GT4.6:

        I live in Canada too. And there is no HST here, only the 5% GST. By now you know where I live.

        Don’t blame the government. It’s no North Korea. It’s the government that you elected. YOU wanted to pay HST and your votes reflected that. And you know which party(s) advocate less tax during campaign and you chose not to vote for them.

        • 0 avatar
          28-Cars-Later

          I can’t speak for Canada, but in the age of computerized voting booths I doubt we’re still “electing” anyone.

          • 0 avatar
            Luke42

            Election fraud isn’t necessary, though it might have helped deliver Ohio to the Republicans in 2004.

            It takes so much money to get a party nomination that you have to win with big political donors before you have a chance to go before the people. That is sufficient to explain how we’re not really electing anyone. See: http://www.ted.com/talks/lawrence_lessig_we_the_people_and_the_republic_we_must_reclaim.html

            Congress members spend most of their time (60%) chatting up donors and begging for funds for their next campaign. That also is sufficient to explain how we’re not really electing anyone. See: http://www.thisamericanlife.org/radio-archives/episode/461/take-the-money-and-run-for-office

            Lastly, marketing is a powerful force in our society. When you have enough money and time, you really can polish a turd of a candidate or bury a diamond of a candidate. And the “winners” of the money-primary and the party-primary have the resources to do that.

            In other words our system can be gamed with fully functioning voting machines. And the people who are really on board with one of the big political parties will even cheer for it, if their team will do well in the short term.

        • 0 avatar
          99GT4.6

          Im blaming the government because they just wasted $585 million dollars moving two gas power plants for political reasons during the election. This comes after they already wasted billions on other scandals throughout the past few years; money that could have been used to improve the roads they now say we don’t have enough money for. And I did not vote for this government and I never wanted the HST. I chose to vote for the party that traditionally advocates less taxes but voters in Toronto (as well as a few other places) foolishly didn’t. Also if there is billions of dollars in known scandals wasted I have a very hard time believing there isn’t more wasteful spending that can’t be cut.

  • avatar
    Big Al from Oz

    Why not tax tyres?

    Tyres are a great indicator of how a vehicle is driven and used. It doesn’t matter what form of energy is powering the vehicle or its weight etc.

    Talking of tax, the US citizens will be paying tax for a long time. Even if the government stopped providing any services of any shape or form.

    It’s called external debt.

    • 0 avatar
      CJinSD

      Taxing tires would be ridiculous because they’re one of the last things you want people to scrimp on.

    • 0 avatar
      Hummer

      Have you not seen the price of tires lately?

      I just bought a new set of tires, cost a little over $1,400, same set, same size, same ratings; cost just over $800, 2 sets ago

      And I searched high and low on price.

      • 0 avatar
        CJinSD

        I never said O***a wasn’t ridiculous. Printing almost a trillion a year has driven up commodity prices, of which rubber is one. Then you’ve got tariffs on cheap imported tires, because why not pile on the peasants? What do you expect from the first tyrant to take a 9-figure family vacation while cutting pennies where they’ll do the most harm to the public?

        • 0 avatar
          Hummer

          Preaching to the choir, brother

          My tires were made in America, so if nothing else I helped a little.

        • 0 avatar
          KixStart

          If our monetary policy is so bad, why aren’t we falling against other currencies?

          • 0 avatar
            danio3834

            Are you kidding?

            In case you’re not, go buy anything in Canada, we’ll be asking you for extra if you pay with US cash.

            For everyone else with a short memory, around the turn of the last century the US dollar was ~1.60 to one of ours.

          • 0 avatar
            wsn

            @danio3834:

            Are YOU kidding?

            I have recently priced out a bathtub. The same model costs about $5000 in the US and $9000 in Canada.

            In real purchasing power, USD$1 = CND$1.1 for low end stuff, USD$1 = CND$1.8 for high end stuff.

          • 0 avatar
            CJinSD

            Look at commodity prices for an accurate reflection of the purchasing power of the dollar. Everyone is in a race to deflate the value of their currencies, so all they’re achieving is destroying the savings of their victims.

  • avatar
    canddmeyer

    Tax, tax, tax. We’ve had enough. If it wasn’t for the Sierra Club tying up our tax dollars in court blocking projects until the costs have quadrupled we’d have the best roads in the world, like we used to have before the enviro-whacko’s got to tying things up in courts.

  • avatar
    99GT4.6

    How about controlling the out of control spending first. Once that is actually under control then talk about raising taxes if need be. Im from Ontario where the Liberal government has literally wasted billions in various stupid scandals. They have also recently proposed raising taxes to pay for roads in Toronto. I would reluctantly accept this if I believed the money would actually go to fixing the roads and there was actually no money to be found to fix them. When governments waste billions on scandals that they could have used responsibly fixing actual problems then it shows they aren’t responsible and don’t actually need more revenue.

    • 0 avatar
      danio3834

      The problem now is that they still need to pay for the roads, and we’re still left with the debt from those scandals. The tax man cometh and we hath no more to give.

  • avatar
    DC Bruce

    I think raising the gasoline tax is the simplest thing, even though it “penalizes” people who drive thirsty vehicles (but I thought that was the point, wasn’t it?). As far as the argument that “poor people” can’t afford a Prius (what about used?), as numbers of people have demonstrated, the incremental dollars in fuel taxes saved by driving a Prius vs. something like a Focus or a Cruze is trivial.

    But since we’re asking people to pony up more for roads and bridges, it would be nice to eliminate the direct subisidies to hybrids and EVs at both the state and federal level. Most states, including mine, for example don’t charge sales tax on hybrids or EVs. That’s a significant subsidy.

    Over the road trucks are subject to their own, separate taxation scheme — apart from motor fuel taxes — although people can argue whether or not they contribute their fare share in relationship to the wear they inflict on the roadways.

    • 0 avatar
      KixStart

      The problem for the poor isn’t Prius vs Focus it’s car vs no damned transit.

      We have alleged bus service here but I still see people walking upwards of 3 miles to get to a fast food job. Or two miles to get groceries.

      • 0 avatar
        wsn

        That’s not a problem caused by gas tax.
        How about make Social Security Tax starting at $100k, instead of ending there?

        • 0 avatar
          28-Cars-Later

          FICA is the only Federal tax paid by all US workers, the Federal income tax is effectively optional for about half.

          In the current system, exempting say the first 50k of income from Fed income tax for all in lieu of various credits gives everyone a nice boost and would reduce negative income tax revenues.

          I’d also advocate for the Feds to stop playing social engineer with FICA funds and the income tax, and then we won’t have as many funding shortfalls and “oh shit” moments when writing the budget. FICA was originally intended for the then very old so they wouldn’t be on the streets and later added socialized medicine for the elderly was added, it should stop there. No more SSDI, no Section 8 monies, no more LBJ era giveaways for votes, and no freebies with people from protected classes being diagnosed with… depression (yes this happens).

          • 0 avatar
            corntrollio

            ::In the current system, exempting say the first 50k of income from Fed income tax for all in lieu of various credits gives everyone a nice boost and would reduce negative income tax revenues.::

            That’s effectively what we’re already doing. Median household income is about $50K.

            Voila.

            ::How about make Social Security Tax starting at $100k, instead of ending there?::

            Social Security is a pay-in/pay-out system. If you pay in, you get money back, based on what you’ve paid in. It is a regressive tax with progressive benefits, if you want to get technical. I can explain in more detail if anyone is interested.

            What wsn is suggesting would make it into a stronger redistribution scheme. Some people would have problems with that, others wouldn’t.

  • avatar
    Hummer

    So many here seem straight gullible to anything that the gov’t master says.

    There is much money to be cut, and cutting the red tape alone would solve most of the problems.

    But no, we have to tax even more because they don’t receive enough money, they print so much money each year that they need to receive even more in return. Stop the crap, stop listening to special interest groups who have a single motivation of money (sierra)

    While we’re at it, since we’re finding that most EV owners make around 200k a year, why not put a 7,500 tax on EV purchases.

    Why keep putting so much money into secondary roads, if it’s not an interstate, large highway type road, then stop wasting money upkeeping it, vehicles can navigate dirt roads just fine. If they don’t like it, let their district pay for the work done, but don’t tax the majority for something that is unnecessary.

    • 0 avatar
      gslippy

      $200k/yr was an early adopter figure from 2010. Nissan says the ‘average’ Leaf owner makes $125k/year, so I guess I’m one of their below average customers.

      Taxing EV purchases $7500 is silly, unless you consider EVs to be as dangerous as cigarettes.

      There are plenty of bad secondary roads; sadly, I’ve found their condition to match the income of the neighborhoods they’re in. Smells of politics to me.

      • 0 avatar
        Hummer

        We have a politic special just down the road from me, it has been repaved 4 times in 3 years. Local businessman/ Ex senator isn’t liked by the local Media/ Media fanbois(libs who at the time were in power). After it was repaved some arbitrary law was found stating how it was out of spec, so then they put a layer of the worse possible asphalt, I can’t even imagine how it was legal for use on roads, it felt like driving 1 mile on it was equivalent to 300 miles on my tires.

        Anyways after re-re-redoing the road it’s barely any different then it was originally, there was nothing wrong with it to begin with, no potholes, no major cracks, decent shoulder.

        If we would remove red tape, make a simple guidelines for companies who do the work to follow, and if they don’t do the work correctly, it either must be redone or they get an amount deducted from the total take, then I believe we could decrease costs quite a bit.

        If there was TRUE transparency, we would be allowed to see how every penny was spent, I’d be willing to pay for that agency, Wouldn’t happen though…

        My post wasn’t submitted for some reason, so I may have missed something in this rewrite.

  • avatar
    SoCalMikester

    Raise the tax already then. Makes way more sense than introducing a whole new layer of Bureaucracy with added GPS crap. Unless the whole idea is to keep making government bigger…?

    • 0 avatar
      Japanese Buick

      We’re seeing the same thing in aviation. Govt keeps proposing user fees that would be expensive and intrusive to administer. Aviation interest groups keep saying “just raise the tax on aviation fuels and be done with it”. Seems sensible and much less complex and intrusive.

  • avatar
    GST

    Hey, I thought lighter vehicles would cause less wear to the roadway and bridges. Shouln’d need for maintenace decrease?

    • 0 avatar
      gslippy

      True, except that cars are getting heavier – not lighter. Today’s Civic weighs 25% more than the 1979 model.

      • 0 avatar
        shaker

        The Civic probably rides on tires that are 25% wider than 1979, so the actual load is spread over more road (lb-in-squared).

        That’s the funny thing about roads, for the most part, we only use the part where the tire tracks are — so just pave those areas and save a crap-load of cash ;-)

        • 0 avatar
          Summicron

          And spend that saved cash on fuel, man hours and equipment to mow what isn’t paved?

          However…. your idea would certainly force highway speeds down to something *I’d* be comfortable with.

          • 0 avatar
            Hummer

            I doubt you would ever need to mow any of it, from oil dripping off the cars, to the speeds, what few weeds would never get tall enough to do any harm, but then again I’d rather just have dirt roads.

  • avatar
    DenverMike

    Yap. The problem is the US was built up on the promise of cheap fuel. That’s too late to undo. And the Interstate Highway System drove it home. The whole thing’s a scam and where’s our pubic transportation???

    Once we got dependent on Dino juice, OPEC was happy. And happy enough to keep using US Dollars for all their cash transactions. 100%. Which in turn made the US happy… With currency exchange fees, the US gets a small bite of every dollar they make… For now.

    It’s a big Pyramid Scheme that’s in its final days.

  • avatar
    ToxicSludge

    Both my wife and I have fuel efficient vehicles.We don’t drive much because we are old and live on fixed incomes and the price of fuel is too expensive.

  • avatar
    slavuta

    Urbanization

  • avatar
    jim brewer

    The shortfall in most states runs around forty cents per gallon. So I have a simpler solution than the VMT: Raise the gas tax forty cents per gallon.

    Index it to construction costs. Better yet, raise the tax to fifty cents per gallon devote the extra nickel to energy efficiency research and abolish CAFE. Why not? The drivers of the gas hogs are automatically disproportionately contributing to the solution and have reason to cut back on consumption.

    After a few years, with continued energy efficiency, there is another shortfall, inflation adjusters notwithstanding. Raise the tax a little more.

    Electric cars not paying their way? Well yes, they are. The sales tax on electricity most places almost exactly matches the gas tax.

    I suspect the VMT is a scam to facilitate privatized (read: cronyized) toll roads.

    • 0 avatar
      shaker

      Toll roads (i.e. like the Chicago Skyway/Von (Dan) Ryan Expressway) that require drivers to pull into toll plazas every few miles to drop 80 cents to $1 are a ridiculous waste of fuel, and the maneuvers required to cross 3 lanes of traffic, slow down from 60+ mph, drop coins, re-accelerate and merge probably cause more wear than a non-toll road. Of course, you can get an EZ Pass, but the potential for tracking your location (on the toll roads that utilize it) is there, as well as the potential for gauging your speed, and mailing tickets to you.

      Private (-ized) enterprise at its best.

      • 0 avatar
        Summicron

        “Von (Dan) Ryan Expressway”

        Hah! Drove it for years and never thought of that.

        Yeah, toll plazas keep your adrenal gland in tip-top shape.
        The accelerating and merge part remind me of the land-rush scenes from “Far and Away”.

        • 0 avatar
          Mitsu_fan

          In newer toll systems you DO NOT stop. The toll plazas have cameras and sensors that take a pic of your plate. You get a bill in the mail the next month.

  • avatar
    NMGOM

    I hate to admit it, but as time has gone on, and the complexity of propulsion systems for vehicles has increased, simple fuel taxes won’t be as effective as they once were. Look at what is happening:
    1) gasoline
    2) diesel
    3) CNG
    4) H2 fuel cells
    5) EV’s
    6) Ethanol
    7) Battery-electric hybrid versions of 1), 2), 3), and 6)

    If we try taxing each of these combinations “fairly”, we’ll go nuts with tax code that is 1,000,000 pages long! So, perhaps it is time to experiment with taxing miles driven, and let it go at that. Cars could just pull into a certified station of some type for an annual odometer reading before applying for re-registration. What is wrong with this?

    ——————–

  • avatar
    danio3834

    How about this, fix the gas tax you already have so all of it is actually used on infrastructure. Wherever the rest of the money goes now, cut that out.

  • avatar
    nrd515

    As long as it actually goes for roads and bridges, I’m fine with a gas tax increase of .25 a year for 4 years, but not if they(congress, etc) have any way of moving the $$ someplace else. I don’t want to have to spend a couple of thousand bucks a year, or whatever it is, a buck or so every time I get gas is pretty painless. I pay estimate taxes every three months, and I got slammed this year, so it’s a struggle to save up money that I don’t need.

  • avatar
    DenverMike

    A 25¢ increase per gallon, per year? You’re smoking crack. OK, 15¢ more a gallon, effective immediately and a 1¢ yearly increase after that.

  • avatar
    CelticPete

    I’d slap a carbon tax – and end electric vehicle subsidies. Thus electric vehicles contribute to the tax coffers when you charge them with electric grids that use carbon. The tax could be lower because it would cover heating and oil. And any grid that uses carbon.

    This would be good for our grid, good for the enviroment and good for the roads.

    • 0 avatar
      Hummer

      Chairman Mao and Che Guevara called, they want their propaganda back.
      Seriously we’re talking about money for highway improvement, not funding furthered corruption and special interest groups.

      • 0 avatar
        CelticPete

        You could legislate road improvements into it.. like 80% of the tax goes to road improvement – that kind of thing. A carbon tax is more equitable because as we shift towards electric hybrid cars we want to make sure the grid is encouraged to be clean.

        Sure coal is cheap but its hardly an improvement if everyone drops gas and then uses a coal based grid to power up the car.

      • 0 avatar
        CobraJet

        Agreed. I am familiar with some of the DOT funds that flow into my area. A lot of the money is never spent on roads. It goes for walking trails, bike paths, trolleys and road “beautification” projects. Let’s figure out how to tax the walkers, bikers, and public trans riders per mile.

      • 0 avatar
        Ubermensch

        Ahhh, classic red-baiting. A sure sign that someone doesn’t have an argument.

  • avatar
    wsn

    One more idea:

    Why not just tax new cars based on weight?

    Yes, there will be more electric cars. But with whatever new tech, most cars still weigh 3000lb or more. It’s not like they will shrink to 500lb.

    This new tax will drive people to:
    1) Buy light cars. That means less pressure to road, less fuel used, more agile cars. All the pluses.
    2) Keep their cars longer. That means less landfill. Also good.

  • avatar
    reclusive_in_nature

    Not every problem has to be solved by more taxation.

    For instance, how about the States and/or federal government sell license plates to drivers with proven safe driving records that legally permit them to go 10 or 15 miles over the speed limit?
    OR build autobahn-like (with autobahn-like speed limits) roads parallel to the existing highways and interstates and charge a large enough toll to pay for itself and maybe even upkeep for the other roads?

    I know that those aren’t the absolute best solutions, but at least it’s a line of thought that isn’t as lazy and unimaginative as just throwing more taxes at all our problems.

    • 0 avatar
      Hummer

      I could really get behind the 10-15 over liscense plates.

      I could easily see them working well, have them cost the user $100 every 6 months/ year to renew.
      Hell yea

  • avatar
    50merc

    I’m against raising gas taxes. The fact I have a tugboat-size 1976 LTD Landau with the 460 cubic inch engine has nothing to do with my opinion.


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