Many of this nation’s roads and highways are paid for by states — well, they’re actually paid for by you and me — through state-levied gasoline taxes. But as vehicles become more fuel-efficient and more people drive electric vehicles, which don’t require gasoline at all, states are worried about how to pay for infrastructure.
One way many states are doing it is through flat fees. This month, Texas became the latest state to charge an additional registration fee for EVs, set at $200. So the increasing electrification of personal vehicles is paving the way for a new kind of tax.
For anyone who isn’t a big fan of the gas tax, Jim Aloisi at the Massachusetts Institute of Technology has good news for you.
“Guess what? It’s gonna go away on its own because we’re having this transition to electric vehicles,” he said.
Aloisi said state and federal governments should be experimenting with gas tax alternatives because they could be facing major losses: “$25 billion in lost transportation revenues every year.”
Most states have imposed some sort of flat additional registration fee for EVs to cover what they aren’t getting in gas taxes.
“The difference is you get hit with that tax all at one time versus paying it out over the year per gallon as you use it,” said Brianne Glover with Texas A&M’s Transportation Institute. “But it’s supposed to be sort of a replacement dollarwise.”
A flat fee may even out on the government’s side of things, but Erich Muehlegger with the University of California at Davis said that for the driver, “levying an annual fee on an electric vehicle is, you know, going to be much more expensive on a per-mile basis for someone who drives that electric vehicle a little bit relative to someone who’s putting lots of miles on that electric vehicle.”
That’s why Douglas Shinkle with the National Conference of State Legislatures said some states are trying other models that charge per mile.
“Through an odometer reading. There are things that you can plug into your vehicle,” Shinkle said.
Another option? Taxing kilowatt-hours at charging stations. But Garett Shrode with the Eno Center for Transportation said that approach has its pitfalls because “80% of electric vehicle charging happens at the home and not at public chargers.”
Though it could be a good option for states that get lots of visitors, he said.
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