Draft Proposal Would Create Agency To Tax Cars By the Mile

theodp writes "The Hill reports that the Obama administration has floated a transportation authorization bill that would require the study and implementation of a plan to tax automobile drivers based on how many miles they drive. The plan is a part of the administration's 'Transportation Opportunities Act,' and calls for spending $200 million to implement a new Surface Transportation Revenue Alternatives Office tasked with creating a 'study framework that defines the functionality of a mileage-based user fee system and other systems.' The office would be required to consider four factors — the capability of states to enforce payment, the reliability of technology, administrative costs, and 'user acceptance' — in field trials slated to begin within four years at unspecified sites. Forbes suggests the so-called vehicle miles traveled (VMT) tax should be called the Rube Goldberg Gas Tax, because while its objective is the same as the gas tax, the way it collects revenue is extremely complex, costly and cumbersome." The disclaimers are thick on the ground, though; note, this is an "early draft," not pending legislation.

Re:Fuel Tax Works Fine

[afidel]

Electric vehicles and increasing fuel economy, it's become politically unacceptable for some reason to increase the fuel tax rate which means revenue has been dropping and the drop is likely to accelerate even as our need to overhaul or transportation infrastructure is increasing (average age of bridges in the US is 50+ years even though most were designed for 40 year lifespans and for half the traffic they support today).

Re:Couldn't be simpler

[jtownatpunk.net]

I've never "renewed my pates" in my life. They send me a bill, I send them money, they send me a sticker to put on my plate. If we have to add in an odometer reading, who's going to be authorized to record that information? Am I going to have to go to the DMV every year? That place is already a clusterfuck. Am I going to have to do it when I get my car smogged? That happens every 2 years. Well, it will after the first 5 years or so. Am I going to have to make quarterly estimates or something until that happens?

Re:I would support it if...

[Ichijo]

A consumption-based tax practically balances itself. The heavier vehicles create more wear due to their greater mass and they pay more into the tax fund because they consume more fuel to move that mass around.

No, the fuel tax doesn't even come close to pay for road wear, because road wear is a function of the cube of the weight. This means a 6,000-lbs vehicle causes 8 times as much road wear as a 3,000-lbs vehicle, but of course it doesn't use 8 times as much gasoline per mile!

Re:Bad.

[fuzzyfuzzyfungus]

The problem isn't taxing for road usage(in fact, were it not for the culture that you mention, such a proposal would theoretically be equally desireable for conservatives(who tend to like "users fees" because they dislike taxes and dislike the possibility that people might end up being subsidized)) and liberals(who tend to suspect that individual-vehicle transport, especially the petro kind, has been the recipient of massive, if not overt, subsidies for pretty much the entire post WWII period, making possible an entire suburban material culture that cannot exist without those subsidies).

The problem with mileage taxes is with administration, enforcement, and mission creep. Unlike, say, fuel taxes(which have the fairly convenient advantage of approximately taxing a composite of vehicle size and vehicle miles traveled, which is a good rough estimate of vehicle road 'consumption', without ever having the tax man leave the shop), mileage taxes require, at bare minimum, the tax man inspecting every vehicle's odometer(or at least a sufficiently large sample that most people report theirs honestly on the 1040v.2). If mission creep or ulterior interests come into play, you could pretty easily end up with GPS black boxes, or other less tweakable(you don't even need to crack the odometer, just ensure that the rotations to miles conversion it is using is based on slightly smaller wheels than you are using) methods.

Employing an overhead-heavy, potentially very invasive, taxation strategy when a simple retail sale tax one would work nearly as well strikes me as a serious problem. The notion that, while many roads are basically natural monopolies, and thus cannot be run on free market lines, one can attempt to make one's payment for road use approximately proportional to their use of roads seems entirely sensible.

Re:Bad.

[Wyatt Earp]

Fact, the Federal Gasoline Tax was last raised in 1993, not the 1980s.

Fact, 40% of the Federal Gasoline Tax doesn't go to transportation construction or maintenance, but to Federal Budget earmarks.

Static View of Taxes

[geoffrobinson]

People on the liberal end of the spectrum tend to view taxation in static terms. The rich have a certain amount. You raise taxes on them 10%, you get 10% more revenue. Life is way more complicated than that.

Wealth flees. People cut back in other areas. People hire less. And a bunch of other unintended consequences we can't foresee.