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COLUMNISTS
TODAY'S STORIES
08.01.2009
Could Mileage Charges Replace The Gas Tax?

Speaking of congestion charges, here's a related idea making the rounds. As I mentioned last week, insurance companies are starting to think about charging drivers for each mile they drive. But now it turns out that state governments may beat them to the punch: The AP reports that Oregon has established a pilot program for monitoring vehicle mileage remotely, equipping 300 cars with GPS devices that track mileage, location, and the time of day that the car is used. Oregon is just one of several states exploring ways to track vehicle mileage, with the goal of eventually replacing gas taxes with a per-mile road-use tax. The reasoning here is that, in the future, people will be driving cars that use little or no gasoline, which would leave states in the lurch if they don't figure out some sort of replacement for the gas tax.

It's an idea that strikes me as a bit premature. Sure, in the long run, we'll all be driving electric cars or plug-in hybrids, at which point it would make sense to have some sort of mileage-based tax that states could levy to pay for road maintenance. In the near term, though, if less driving and a shift toward more fuel-efficient vehicles do start putting a squeeze on a state's road budget, then the easiest and most environmentally sound way to make up the shortfall would be to simply increase the gas tax.

But if they ever do go into effect, GPS-enabled per-mile road taxes could be a nifty way to make congestion pricing a reality over large swaths of the United States (perhaps even in New York City, where Mayor Bloomberg recently tried and failed to implement it). As the federal Transportation Review Board has pointed out, it would be relatively simple to charge drivers different per-mile tax rates depending on which roads they used and when they used them. (There would be obvious privacy concerns to address, though these problems might not be all that different from the ones inherent to the EZ Pass or other electronic toll-collecting systems.) Differential pricing would be an easy way to discourage drivers from using roads during peak times, leading to fewer accidents, less wasted gas, and a lot less wasted time during rush-hour commutes.

--Rob Inglis

Posted: Thursday, January 08, 2009 10:12 PM with 3 comment(s)

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JEFF FREY said:

I think this would be a dumb idea. After all, we want to encourage people to use less gasoline. Plus, the intrusion factor of this plan makes for bad politics. Not only would this device record miles driven, but also speed and a complete track of your car's location as a function of time.

It would be better to just raise the gas tax if  more revenue is needed to maintain roads. Or supplement the gas tax with a modest yearly per-vehicle tax.

January 9, 2009 2:06 PM

jwl2672 said:

Forget this idea.  The Weekly Standard presented the ingenious idea of a Net-zero gas tax.  This from a conservative and an agnostic of global warming.  The idea is that the price per gallon will increase by a $3 tax with the equivalent amount being returned into taxpayer's/social security recipients' pockets immediately via an immediate tax break/increase in SS benefits.  (say 14 gallons on average per week x $3).  This results in the average American being completely "net-zero" (no impact) while encouraging reduced use of gas.  You guys may be in it for the global warming - I'm in it for screwing the Middle East, Russia, Iran, Venezuela over and for reduced traffic congestion.

www.weeklystandard.com/.../949rsrgi.asp

January 9, 2009 3:51 PM

Environment and Energy said:

Back in January, I wrote a post about the possibility of replacing the gas tax with a tax on vehicle

March 10, 2009 10:58 AM