The Cellar - Tax by the mile?

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Tax by the mile?

You have to admit it is a novel idea. I know that some cities such as London either are, or have considered to begin to tax drivers that go to hi volume, busier areas. I am more of a proponent of the idea of a flat tax, and this sounds more like a user tax.

Quote:

AP Interview: Transportation secretary says taxing how much we drive may replace gasoline tax
By JOAN LOWY

Associated Press Writer

7:17 AM EST, February 20, 2009

WASHINGTON (AP) — Transportation Secretary Ray LaHood says he wants to consider taxing motorists based on how many miles they drive rather than how much gasoline they burn — an idea that has angered drivers in some states where it has been proposed.

Gasoline taxes that for nearly half a century have paid for the federal share of highway and bridge construction can no longer be counted on to raise enough money to keep the nation's transportation system moving, LaHood said in an interview with The Associated Press.

"We should look at the vehicular miles program where people are actually clocked on the number of miles that they traveled," the former Illinois Republican lawmaker said.

Most transportation experts see a vehicle miles traveled tax as a long-term solution, but Congress is being urged to move in that direction now by funding pilot projects.

The idea also is gaining ground in several states. Governors in Idaho and Rhode Island are talking about such programs, and a North Carolina panel suggested in December the state start charging motorists a quarter-cent for every mile as a substitute for the gas tax.

A tentative plan in Massachusetts to use GPS chips in vehicles to charge motorists by the mile has drawn complaints from drivers who say it's an Orwellian intrusion by government into the lives of citizens. Other motorists say it eliminates an incentive to drive more fuel-efficient cars since gas guzzlers will be taxed at the same rate as fuel sippers.

Besides a VMT tax, more tolls for highways and bridges and more government partnerships with business to finance transportation projects are other funding options, LaHood, one of two Republicans in President Barack Obama's Cabinet, said in the interview Thursday.

"What I see this administration doing is this — thinking outside the box on how we fund our infrastructure in America," he said.

LaHood said he firmly opposes raising the federal gasoline tax in the current recession.

The program that funds the federal share of highway projects is part of a surface transportation law that expires Sept. 30. Last fall, Congress made an emergency infusion of $8 billion to make up for a shortfall between gas tax revenues and the amount of money promised to states for their projects. The gap between money raised by the gas tax and the cost of maintaining the nation's highway system and expanding it to accommodate population growth is forecast to continue to widen.

Among the reasons for the gap is a switch to more fuel-efficient cars and a decrease in driving that many transportation experts believe is related to the economic downturn. Electric cars and alternative-fuel vehicles that don't use gasoline are expected to start penetrating the market in greater numbers.

"One of the things I think everyone agrees with around reauthorization of the highway bill is that the highway trust fund is an antiquated system for funding our highways," LaHood said. "It did work to build the interstate system and it was very effective, there's no question about that. But the big question now is, We're into the 21st century and how are we going to take care of our infrastructure needs ... with a highway trust fund that had to be plused up by $8 billion by Congress last year?"

A blue-ribbon national transportation commission is expected to release a report next week recommending a VMT.

The system would require all cars and trucks be equipped with global satellite positioning technology, a transponder, a clock and other equipment to record how many miles a vehicle was driven, whether it was driven on highways or secondary roads, and even whether it was driven during peak traffic periods or off-peak hours.

The device would tally how much tax motorists owed depending upon their road use. Motorists would pay the amount owed when it was downloaded, probably at gas stations at first, but an alternative eventually would be needed.

Rob Atkinson, president of the National Surface Transportation Infrastructure Financing Commission, the agency that is developing future transportation funding options, said moving to a national VMT would take about a decade.

Privacy concerns are based more on perception than any actual risk, Atkinson said. The satellite information would be beamed one way to the car and driving information would be contained within the device on the car, with the amount of the tax due the only information that's downloaded, he said.

The devices also could be programmed to charge higher rates to vehicles that are heavier, like trucks that put more stress on roadways, Atkinson said.

You have to pay for the roads somehow.

It's an interesting question. If a gasoline tax is the only source of income for the roads, that will tend to make people want to buy more fuel efficient cars so they can limit their taxes. But if you have a tax on mileage, you will lose that push for fuel efficiency. Doesn't make sense.

A gasoline tax tends to make people drive fewer miles by increasing the cost of driving, and a switch to charging by the mile will not change that. It will just take away the motivation to buy a fuel efficient car.

Throw in the invasion of privacy that comes about by tracking cars, and I can't see one logical reason to switch to this new way of collecting funds for roads.

If there isn't enough money, and you have to take the money from the people somehow, just increase the existing gas tax.

Pennsylvania already knows how many miles we drive a year. Doesn't everybody else have to report mileage on their vehicle registration renewals?

Quote:

Originally Posted by wolf (Post 536699)

Pennsylvania already knows how many miles we drive a year. Doesn't everybody else have to report mileage on their vehicle registration renewals?

No, not in Colorado.

Why would we waste all that technology and effort when the end result would just be to diminish the benefits of fuel efficiency?

Quote:

Pennsylvania already knows how many miles we drive a year. Doesn't everybody else have to report mileage on their vehicle registration renewals?

You can lie, but they record the mileage at vehicle inspection.

Quote:

Privacy concerns are based more on perception than any actual risk, Atkinson said. The satellite information would be beamed one way to the car and driving information would be contained within the device on the car, with the amount of the tax due the only information that's downloaded, he said.

Until the judge allows the government, or your spouse's lawyer to grab that info. :mad:

This is a regressive policy. Miles do not matter in any sense, it all has to do with how much gasoline is burnt unless you are talking purely about maintaining roads, which the article does not address.

Tax the gas, not the miles.

Quote:

Originally Posted by wolf (Post 536699)

Pennsylvania already knows how many miles we drive a year. Doesn't everybody else have to report mileage on their vehicle registration renewals?

Michigan, nope.:headshake

Quote:

You can lie, but they record the mileage at vehicle inspection.

The what now ? :lol:

Quote:

Originally Posted by wolf (Post 536699)

Pennsylvania already knows how many miles we drive a year. Doesn't everybody else have to report mileage on their vehicle registration renewals?

Not in Georgia.

I am not favor of this, at least from what was printed. If you drive a lot, doesn't a gas tax do the same thing? I don't get it. It seems like it would create more waste, having to keep track of people's milage.

I don't like the idea, either. Taxing vehicles based on weight would make better sense, it seems to me, because it would reward smaller cars that contribute less to wear and tear of the highways. Or tax tires so that the more you drive, the more you must pay, and make public transportation free. I don't know! :(

The point you all seem to be missing is that this policy would go a step further than encouraging fuel efficiency by discouraging driving in the first place. That would hopefully increase demand for public transportation enough to pull the majority of the USA out of the Stone Age in that regard.

That said, there will always be a spectrum of price sensitivity: some will drive a ton of miles in an inefficient car; some will drive as little as possible in an efficient car. Nothing you can do will change this until congestion and efficiency are non-issues.

Also, this idea is not innovative or new in any way. It's been around for a long time.

I don't see why they don't keep both taxes though. Gasoline purchase is orthogonal to road use.

Quote:

Originally Posted by Perry Winkle (Post 537898)

The point you all seem to be missing is that this policy would go a step further than encouraging fuel efficiency by discouraging driving in the first place.

A tax on gasoline is a tax on driving. You need gasoline to drive. So it does discourage driving. It also encourages fuel efficiency, because you can reduce the tax by getting a more fuel efficient car. You can never eliminate the tax unless you switch to an electric or CNG vehicle or stop driving.

The gas tax is invisible to most people at this point. If you put a new tax up front and in their face, it might affect their behavior more appreciably.

Quote:

Originally Posted by Perry Winkle (Post 537902)

The gas tax is invisible to most people at this point. If you put a new tax up front and in their face, it might affect their behavior more appreciably.

I agree that it's something people are used to and most people don't think about it when filling up.