Home / Auto News / News article: U.S. Goverment Looking To Re-Align Highway Fund Taxes To Include Plug-In Cars - AutoGuide.com News
 |  Mar 31 2011, 3:58 PM

Federal legislators have begun examining ways to tax highway users based on Vehicle Miles Traveled (VMT) as a way to bring up shortfalls to the Highway Trust Fund.

A concern is that as fuel-efficient hybrids and plug-in cars increase, fuel tax generated revenues will do little for the already insufficient funding base.

In a Congressional Budget Office report released last week, ways were examined in great detail to begin tracking vehicles across the country via GPS, electronic sensors, and other sophisticated technology.

The Obama administration has said it wants $566 billion over the next six years to pay for the federal portion of roadway building improvements. States and local municipalities also pay for these projects.

Since 2008, the general fund had to be tapped for $30 billion to make up for deficits. Presently, gasoline is taxed at 18.4 cents per gallon, and diesel at 24.4 cents. This has been used until recently to raise needed revenues, but the U.S. DOT says it is now not enough.

Earlier in March, the Senate Budget Committee expressed concerns over super efficient vehicles getting away without paying an equitable share.

The CBO report was quickly generated to give policymakers info to better propose new road tax legislation. Other concerns raised by the CBO study are for lower income, urban, and rural dwellers. It made a case that VMT-based taxation could be more equitable, if not entirely so.

Concerns over citizens’ privacy would need to be tackled, as VMT monitoring involves nationwide tracking and reporting of drivers’ data. Also, figuring out how to fairly tax heavy trucks compared to much-lighter cars and many other issues would need to be settled.

Any possible scenario could be proposed. For example, fuel taxes could be eliminated, with the VMT taking over. Fuel taxes could be reduced, with VMT taking up the slack. Fuel taxes could be raised, and no move to impose the VMT could be chosen.

[Source: GM-Volt.com]