Wouldn’t it be cool if the gas tax were history?
Of course, removing one tax usually means the addition of a new one, and the state of Oregon has an innovative proposal that would end the gas tax and replace it with a tax on miles driven.
This is an idea that has even been considered at a federal level, so don’t automatically write this off as crazy West Coast politics. Here’s the issue: As cars become more fuel efficient (or eliminate the need for gas altogether), how will states cope with declining tax revenue and generate the money needed to pay for roads?
Oregon’s plan calls for an onboard GPS-based mileage counter that keeps track of miles driven. From there, a tax on every mile would be charged and either collected at refueling stations or along with annual licensing fees.
On the positive side, gas would cost less. However, drivers would either be socked with a massive tax bill every year, or end up paying roughly the same amount as now at the pump. (The GPS devices would communicate mileage information to the pump and calculate the tax, adding it onto the cost of the fuel.)
Here’s something else to consider: Prius drivers would end up paying the same amount of taxes as Hummer drivers. Where’s the tax reward for buying a more fuel efficient car?
Believe it or not, I think it makes more sense to increase the gas tax. That way states can make up any lost revenue and drivers are encouraged to limit their driving or buy a car that delivers better fuel economy. Also imagine the logistical nightmare of tracking the mileage of every car on the road, not to mention the cost of outfitting them all with a GPS system.
Nobody really likes the gas tax, but it works. A mileage tax is a bad idea, because it just replaces an unpopular tax with one that’ll cost too much to get started and then not work as well. Under the gas tax, if you drive more you pay more. A mileage tax would achieve that same result while costing untold millions of dollars to implement.
That just doesn’t make sense.
How would you feel about having the government keep track of every mile you drive?