There has been a lot of discussion lately about increasing the national gas tax. In fact, a proposal to increase the tax, which currently stands at 19 cents per gallon, has been touted as recently as last week. The National Surface Transportation Infrastructure Financing Commission (NSTIFC) has reported that the current infrastructure is dated and needs significant improvements – all of which will cost money that the Treasury doesn’t have.
The NSTIFC has suggested a 10 cent per gallon increase in the federal gas tax to raise revenue – a measure that may actually pass now that gasoline prices have tumbled back down after reaching historic highs in 2008. Time may also be on their side. Congress has not raised the federal gas tax since 1993, more than 15 years ago.
If the feds raise the national gas tax, what will that mean for the states? Will they follow suit? I’m betting yes – with a twist.
Not all of the states are planning a traditional gas tax increase. Oregon leads the nation in a quest for a different kind of tax, a mileage tax. The mileage tax is sort of consumption tax on roads. The idea is that drivers would be taxed on how far they drive rather than how much gas is consumed. Mileage would be calculated using GPS installed in newer cars (older cars would continue to be taxed using the gas tax).
Why change? Almost everyone agrees that the bridges and roads need work. And as cars become more fuel-efficient (we hope) and the price of gas stabilizes (we hope), this means that revenues from the gas tax will not be enough. In other words, those who drive the most miles – and thus use the roads the most – are not necessarily paying the most. Some feel this needs to change.
Oregon isn’t alone. Rhode Island and Idaho are considering a similar tax though based on a self-reporting system rather than the GPS. Chatter about a mileage-based tax has also spread through Colorado, Florida, Minnesota, North Carolina and Pennsylvania.
Congress has given this kind of system some thought, too, though we are clearly years away from seeing anything like this on the national scene.
So is a mileage tax the solution to our infrastructure woes? Tests have gone well in Oregoon. But critics are concerned about potential privacy issues in having government track mileage – and the bigger concern that the tax might eliminate one of the financial incentives for buying a fuel efficient vehicles (though clearly, the gas savings outside of the tax would still be considerable).
What do you think? Keep the gas tax or ditch it for the mileage tax? And if you would keep the gas tax, would you support an increase at the pump if it meant better roads? Any other suggestions?
For two reasons I’d still support the gas tax over the mileage tax:
1) I find the environmental issue to be of primary importance and urgency. Taxing based upon mileage doesn’t allocate costs in the right place in terms of environmental damage.
2) As taxes go, a gas tax is almost perfectly efficient. (There’s practically no way to escape paying it, so compliance will be at or near 100%. And cost of collecting the tax is minimal.)
Yes, a mileage tax makes the most sense and, no, I would never consent to the gov’t (or anyone else) tracking my car’s mileage or whereabouts. Self-reporting? Well, the income tax works that way, but I’d think this would be a lot harder vto enforce. My state (Arkansas) requires you to list your car’s mileage when you renew your tags, so that might woirk. The DMV could randomly check to see if people were reporting true mileage — nothing like another line to stand in down there — not to mention having to pony up the tax, which can be hefty paid all at once, before you can get your tags.
The per-gallon tax has a big advantages: It’s already in place, so everyone’s used to it. A tax increase can be phased in; increase the tax by 1 cent a month for, say, 18 months and it would hardly be noticeable in an environment where market prices can fluctuate several cents a day.
Also, being an excise tax, the per-gallon tax is sort of “invisible”, since it’s built into the pump price. And you pay it as you go, bit by bit, as you fill up. No, it isn’t perfect: a Hummer pays a lot more tax to go 1,000 miles than a Prius. But, then, we might argue that fuel-efficiency would have its own built-in tax incentive; no need for a tax credit when you buy. One more thing: fuel-efficient cars tend to be smaller and lighter, so they’d also produce less wear and tear on the infrastructure.
The really sad part, is the gas tax and mileage tax are horribly representative of the economic usage or environmental damage that people do with their automobiles.
btw, just for context, I live in Portland so I’ve heard and read a TON on this GPS mileage tracking system they used. It is, by definition a horribly idea for privacy. They say they wouldn’t use it for tracking. But the Government tells us lots of things, but generally doesn’t follow through very well at all.
If we want a “fair”, “honest”, “environmentally positive”, “reliable” funding source for road infrastructure the charges should be incurred at time of usage. If you use a public road, have a charge card of some type, just like on a transit system. Make it have no correlation at all to individuals. All interchangeable (this is possible, we do this with many things now). We then have our privacy intact. Charge then for the vehicle type – which the card should be associated with to represent the damage, usage, and stresses a vehicle will put on a roadway. This way SUVs, 18 Wheelers, etc, could pay for their usage and damage incurred on the road. This immediately would be better for the lessened miles that SUVs and 18 Wheelers would drive. They’d be drastically restricted from excessive and abusive uses of the roads just by the simple fact that users would actually have to pay the full costs of their usage then.
This is direct, it makes an impact in decision making (which is economically and environmentally better by far than the idea of the gas tax – which is weak encouragement for efficient cars to begin with). With usage charged directly, without a direct correlation to the individual we maintain privacy, encourage better practices, remove excess auto usage and thus decrease demand to build road systems out beyond their necessity, drastically decreases our needed infrastructure upgrades, and in the end…
…can encourage a wide swath of positive things from getting people out of their lazy cars and walking. We might get a fat reduction for the nation in the process. People lose weight, we decrease medical needs and expenditures. All of a sudden people have money in their pockets – that is, if the Government hasnt’ found another reason to tax them.
Rethink how to administer a tax? Lets get really innovative and just have a flat income tax,that would be a much better tax change.
A use tax for gasoline ,diesel and other fuels (over the road use) would be way to much bureaucracy, we’re already overloaded with government employees. Someone has to stay in the main stream and pay tax’s.
OK lets see the books, how much was collected in fuel tax for 2008. Then lets subtract how was paid out, for road projects. What are the odds that it’s no where zero ? 10 in, 5 out, where’s the 5 ?
I wouldn’t support an increase in tax for either gas or mileage in order to fix our roads. Our method of transportation is outdated, expensive, inefficient and kills people on a daily basis. I would support a tax increase in order to develop useful, efficient, cheap, and safe transportation.
raise taxes on beer!
Taxes at the pump generally have supported the infrastructure needs of the state of NC, if the politics was taken out. Politics skew the allocation of funds and the accountability of road use taxes. That has become an very large issue in NC, the “Good Roads State” in recent years. Governors and DOT commissioners who have four lanes built from no-where to their residences. Politics plays a great role is securing pet projects, such as a four lane road on the Outer Banks, NC, that just happens past by Marc Basnight’s Lone Cedar Cafe, Outer Banks, NC. Small business owner Marc Basnight is power broker in the NC Legislature. Get the picture! It warps the actual expediture of road tax use.
Pay-by-the-mile will not alter this. Toll booths on NC/ VA and NC/SC portions of I-95 will not alter this. Increase monies just causes the appetite of politicians to salvitate more. All make the arguement for “my folks” need this , and “it is good for the whole state”.
What would be “good for the whole state” is for politics to do the people’s work without “what’s in it for me”.
Until governments determine true need and work to determine the cause, and make appropriate decisions to correct the cause, looking for more money just extends the real problem. Reform of existing policies and methology, and greater accountability would be like demanding that conservation of energy become a pillar to energy independence.
I agree with an earlier writer, accountability of funds raise, if true light was given to the accounts, there is avoid between income and outlaw for roads and their maintenance.
Another part of this equation is so often left out by states when they fund road projects and large infrastructure such as bridges. Plans for the efficient maintenance of that investment. They leave that to another time, which usually is long in coming. Example: the I-35W bridge that collapsed in Minneapolis two years ago, August 2007. After the collapse, it came to light that discussions had been had to “possibly” replace that bridge, or substantially improve it.
Companies that do not build maintenance of their infrastructure investment generally encounter large budget years. Stockholders demand better. Taxpayers should be demanding the same.
Civilized slavery is not the answer. Life, LIBERTY, and pursuit of happiness is just some of the rights this mileage tax is transgressing. I seem to remember paying my registration fees for my automobiles, which I feel are more than enough to pay for up-keep of our roadways. I have found out in my life experiences, once someone has got their hands in your pockets, they never want to let go, even after you die, they want more. Thats what I see here, goverment does not want their hands out of your pocket, so now, we have a situation, which I consider literally HIGHWAY ROBBERY. We the people, must band together, and vote-to make sure this communist tax for the PEOPLE, does not pass nationally to enslave the AMERICAN people by a tax on your freedom.
I moved to Steamboat Springs, CO from California a few months ago and not happy about GPS tax per mile idea. When I left CA for CO I thought I was done with such stupid laws, but have learned that it is more a “urban thing” . Elected people in big cities like Denver or LA /SF are most always behinds these braindead ideas. As far as a per gallon gas tax gos I don’t mind if ALL the tax is used on roads and not for public transportation. Subways and buses need to charge enough to break even or quit
With all of the money that the states brings in through various sources there is no reason why they should have to move to such an invasive taxation system. I think what most people fail to remember is that our infrastructure has been in a serious state of decline since the 1970s, well before “fuel efficient” automobiles were available or popular, hence the full force of the gasoline tax was in effect yet it did very little to rectify the poor state of our roads and bridges.
If we allow them to implement this idea, not only will we be paying a “tax per mile”, but we will see a tax at the pump the next time the coffers run low.
We need to put our foot down and demand “NO MORE TAXES” .
I think we should tax everything that moves, that way everything possessed by anyone else would be accountable. Here’s how it would work.
Rationale: Everything that lives and moves and breathes is made up of Carbon (KAR’ bun). This is part of organic chemistry (or-GAN’-ic KEM’-es-try). Carbon Dioxide is called a green-house gas and therefore any transaction of carbon dioxide is game for taxation in our book. Taxation pays for us government, which must rule over everything. Regular people get the shaft while we are treated as we deserve to be treated: as royalty.
Here’s how it works: Set rules that prohibit everything that YOU want to do, but what you don’t want others to do. Tax these items. Don’t worry; more than enough money will be flowing your way. The poor schlups that buy into your plan deserve to pay, since they did not have the brains to figure out this plan for themselves.
Anyway, when people can’t afford to do anything that goes beyond living and breathing and going to work and sending their brats to school (whose birth means another creature breathing out CO2!) and visiting the cemetary on occasion (but sparingly–since there will be carbon cremation taxes and burial taxes, since even decay involves the movement of carbon from one form to the next!), then the lakes and rivers and oceans and highways will be ours to traverse alone! We will tax those who live in the country, for who are they to think they can live on so much more land? And we will tax city-dwellers on a lesser level to make it more profitable for themselves. But we will make it up with communication taxes and grime taxes, to encourage them to stop complaining and to buy soap to keep themselves clean after they scramble around dumpsters for food and heating fuel.
Well, enough for now. I’m working up a sweat. But feel free to build on my ideas–but be sure to keep me in the loop. My future in “the company” depends on my staying on top of the masses.
Note: Let’s all wear greenshirts to show our complicity–let’s never tire to bring about the Obamanation!
N.P., VIP
California