Pay-Per-Mile Driving Tax Wins Support of House Transportation Chairman
By John O'Dell April 29, 2009
Be afraid. Be very afraid.
The idea of a pay-per-mile federal driving tax appears to be gaining ground, despite White House opposition. Without a groundswell of public outrage to tamp it down it could spread through Congress quicker than an outbreak of swine flu.
The chairman of the House Transportation Committee, where a bill to impose such a tariff would ultimately be considered, said this week he thinks Congress needs to quit studying and start acting on a proposal to charge us for every mile we drive.
The idea behind the tax is to raise money for the federal highway fund, which now is dependent on revenue from federal gasoline and diesel fuel taxes.
In the absence of a fuel tax hike, that revenue stream has been shrinking rather dramatically as our vehicles' fuel economy has increased and gasoline purchases have fallen as more of us stay home to conserve funds in the midst of a raging global recession.
Congress historically has been too cowardly to raise the federal gas tax, but some - including Transportation Committee Chairman James Oberstar, a Minnesota Democrat - think a mileage-based tax would work.
"It's going to have to be done," he said during a committee meeting earlier this week, "it's something we have to do [so] why not just move ahead...I am at a point of impatience with more studies."
E&E News, a subscription-only environmental news service that reported Oberstar's remarks, said that he previously has said he thinks a so-called vehicle mileage tax, or VMT, will be included in an annual highway and transit funding measure he hopes to bring to a vote in the House sometime in June.
We firmly believe Congress needs to act, and quickly, to reauthorize and increase funding for highway and transit system maintenance, construction and repair.
But we don't think a flat VMT is the way to do it.
Some have raised questions of privacy - unless the tax would be based on an honor system of self-reporting, the government would have to monitor each motorists' mileage via some sort of on-board GPS transmitter.
But there are ways to do that while still protecting privacy. We're more concerned with the way a VMT would remove incentives for people to buy and drive fuel-efficient vehicles.
A gas tax rewards fuel efficiency - the less fuel you burn per mile, the less tax you pay.
A VMT, unless an elaborate system is devised to adjust for vehicle type, weight and fuel use, charges the driver of a 50-mpg hybrid the same for a 100 mile trip as it charges the driver of a 10-mpg SUV. But that hybrid does less damage to the road surface than the heavier SUV, and surely is less harmful to the environment.
Making the hybrid pay the same as the Hummer to use the roads removes a big incentive for buying the greener vehicle.
A gas tax, though, automatically rewards fuel efficiency. The trick is to make the tax high enough so that revenues would be sufficient to keep our roads in good repair.
A fuel tax is also easier to levy and collect than a mileage tax - drivers pay the correct amount each time they fill up.
A VMT would require installation of mileage transmitters in millions of vehicles, and installation and maintenance of tracking and data recording centers to collect the information and levy the appropriate taxes.
One suggestion has been to outfit gas pumps to record mileage and add the mileage tax to the fuel bill when motorists fill their tanks.
Why not just increase the fuel tax to a reasonable level in the first place?
Neither approach is going to be popular - President Obama has said he's loathe to impose any new taxes or tax increases during this recession - but our road system is crumbling and needs attention.
But let's not create a disincentive for building and buying green cars as we search for a way to fund our highways.
John O'Dell, Senior Editor
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What a stupid, dumb idea. But leave it to the Federal government to come up with such a crazy scheme. If tax revenues are decreasing due to fuel efficiency, then just raise the fuel tax. The system is already in place. Just don't go overboard and people will be fine with it.
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