Feds Interested in Vehicle Mileage Tax, Too, Says DOT Secretary LaHood.
By John O'Dell February 20, 2009We've been arguing for weeks against the idea of states instituting vehicle mileage taxes to replace declining gas tax revenues used for road repair and other transportation programs.
And we knew that the feds were considering the same.
Well, now Transportation Secretary Ray LaHood has made it official: he says he wants to consider a federal program of taxing on miles traveled rather than gallons burned.
Shows how much clout we have!
The Associated Press reports today that LaHood is firmly opposed to increasing the federal gasoline tax during a recession but recognizes the need to raise more cash for the federal highway trust fund.
"We should look at the vehicular miles program where people are actually clocked on the number of miles that they traveled," the former Illinois lawmaker told the AP.
The trust fund, which pays the federal government's share of highway construction and repair bill, required an $8 billion emergency infusion from Congress last year to make up for the gap between what it owned states and what it took in form the 18.4-cents-a-gallon federal tax on gasoline.
Tax revenues are falling because people are driving less and buying more fuel-efficient vehicles these days.
Our point in opposing the idea of a pay-per-mile system has been that a mileage tax would do nothing to encourage people to get out and drive more - might even turn us into a nation of stay-at-homes - and would actually make gasoline cheaper, thus removing a key incentive for buying fuel efficient cars and trucks.
Granted, something will have to change as more and more electric vehicles hit the road, as they don't use gasoline or diesel (not directly, anyhow). But it will be a long time before there are sufficient numbers of such vehicles to make a big difference.
Meantime, it is increased use of hybrids, which do use gas, and of fuel-efficient gasoline and diesel engines that is cutting into gas tax revenue, and an increase in the tax would help reverse that.
There's no perfect solution - if we want, as a matter of national energy and environmental policy - to encourage development and sales of fuel efficient vehicles, we're going to have to come up with a way to augment or replace the gas tax.
But a mileage tax isn't the best way unless it somehow can be structured to still give a break to the most efficient vehicles.
Despite those arguments, and complaints from some that the government tracking their every mile driven smacks of a massive invasion of privacy, the idea of a vehicle mileage tax is gaining momentum.
The National Surface Transportation Infrastructure Financing Commission, which issued a call at the start of the year for a 50 percent hike in federal fuel taxes to fund highway repairs, now is expected to issue a report next week that recommends instead a mileage tax.
Financecommission.dot.gov
Commission president Rob Atkinson told the AP that it would take about a decade to get everything into place - including GPS transponders in every vehicle so mileage could be tracked.
He said privacy wouldn't be an issue because the information gathered to compute the tax would remain in each vehicle's on-board data system and the only info downloaded to the government would be the amount of tax owned.
He also said that the devices could be programmed to collect fees based on vehicle weight, so drivers of small cars wouldn't have to pay as much as drivers of the large trucks and commercial vehicles that cause more road damage.
Here's hoping the commission also looks at a way to identify vehicles by type of powerplant and adjust the mileage tax by that criterion as well.
John O'Dell, Senior Editor
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I'm with you 100%, John. This is an invasion of privacy as well as a decreased incentive to buy fuel efficient vehicles. This is also a waste of resources for two reasons. The first is the decreased incentive to buy fuel-efficient vehicles. The second is the increased infrastrucure needed to impliment and maintain the tracking of miles driven. Why do we want to waste money and resources creating this new system of gathering taxes instead of just raising the darn gas tax? The stupidity of our politicians is frustrating.
It is hard to believe dozens of transportation experts could meet for two years to evaluate over 30 alternatives to the current flat per-gallon gas tax and not even consider a tax based on efficient vehicle assessment (EVA). As you know, a congressional commission has recommended to Congress and the DOT that a vehicle mileage tax (VMT) is the best alternative (having not considered an EVA tax) and at least 17 states (including MA, MN, OR and others) are now actively considering VMT. This is a very bad choice for several reasons, including that by taxing miles and not efficiency the VMT treats the Hummer as it does the hybrid or motorbike. In fact, a Hummer used in the suburbs to go from home to the local mall will pay less tax per gallon than will small vehicles that happen to be in a rural area (which obviously and unavoidably means longer drives). VMT also requires a massive effort and expense to equip all vehicles with mileage tracking mechanisms (GPS, odometer-reading, etc.) And, of course, it raises enormous privacy issues. A better name for it might be "Track 'n Tax".
EVA, on the other hand, does create an incentive to drive efficient vehicles (an incentive noticeable at each visit to the pump, not just upon purchase of the vehicle). It is a software installed at the pump that will calculate each vehicle's per-gallon rate based on current VIN data (make, model, weight, year, etc.). A Hummer, therefore, would pay a much higher per gallon rate than the Ford Escort.
EVA is fair to rurual drivers. It requires each vehicle simply put a VIN barcoded decal on the windshield; the government structure is in place for this (RMV, DMV, etc.). And EVA raises no privacy issues.
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