Oregon Gov pushes pay-by-the-mile to replace gas tax
Filed under: Tax, Transportation
The governor of Oregon is worried about the nation's embracing of high-mileage vehicles. The change could result in a sharp drop in gas tax revenue, leaving his state with a huge deficit, so his administration has come up with a workable alternative - the pay by the mile vehicle tax plan.
The transition to this plan, which would take some time, has been included in the state's new proposed transportation bill. How it would work--
Vehicles are equipped with GPS units that keep track of miles driven. When the driver refuels, a device at the pump reads the total miles driven since the last fill up and adds a per-mile tax charge to the final fuel bill. The gas tax portion of the final total would be deducted. In a test of this system by 300 Portland-area residents, the drivers paid 1.2 cents tax per mile driven and received a refund of their gas tax, 24 cents a gallon.
If my math is correct, vehicles that get 20 mpg would pay the same tax as before. Oddly, cars that get higher mileage would actually pay a higher tax under this plan. For example, a car that gets 30 mpg currently pays .8 cents per mile in gas tax. A gas guzzler that gets 10 mpg, on the other hand, would see its tax per mile cut in half.
I don't have a problem in revising the way funds are collected to keep the nation's roads maintained. I'm uneasy, however, with the government collecting yet another record of my personal life, in this instance, my travel habits. The state claims that the system will not collect any personal data, but I have a theory-- call it Barlow's Conjecture-- that any personal data that can be collected and added to master marketing databases eventually will be.
Despite my qualms, this is the most workable solution I've seen to sustaining state transportation revenue, and so I expect to see it show up on the planning board of many other states.
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Reader Comments (Page 1 of 1)
12-31-2008 @ 10:44AM
Irish said...
Just another way to encourage the continued production of gas guzzlers and keep us addicted to oil. God forbid we break that addiction and find alternative energy - money would be lost. The U.S. needs to stop the madness and start investing in itself by limiting gross profits being poured into the hands of a few and use them for the collective whole. Take the sports teams - ALL THAT MONEY given to players and the owners - I'm sure a football player can live off 1 million a year instead of 5 and the remaining 4 could be tossed to public schools or roads or bridges, etc. Huge corporations should be forced to spare the shareholders billions and reinvest in the nation. Greed is rampant and noone wishes to give up the golden egg - instead, they'll continue to pocket the change and steal from the middle class. We've become disgusting. Does anyone care that I lost my job and I'm a single mother with a child and don't know how I'll feed him next week? Does that multi-millionaire CEO feel my pain? We all know the answer to that. I'll be told to quit being lazy, get an education, get a better job, and the problem with that - I have - I'm just one of those honest individuals that hasn't learned to bilk the populace! We're all going to fail - GREED has become the U.S.'s motto - and it will bring us all down. It's coming folks - a middle class uprising that has never been seen before. Enough has finally become enough.
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12-31-2008 @ 11:30AM
robert said...
You are so right on . The politicians and CEO have no idea how you and i live. Sports salaries are way out in left field. Giving all the billions to banks and the auto companies, now they will raise our taxes you just wait and see. One concerned working stiff
12-31-2008 @ 11:50AM
Steve said...
Good job! I could not have said it any better!
12-31-2008 @ 10:59AM
HallBSHALL said...
Who is going to pay for GPS?? If state; isn't this another expense and where will that money come from? If taxpayer; another expense we don't need.
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12-31-2008 @ 1:07PM
John said...
A policy that rewards less efficient users of gas/oil does not appear to be in the best interests of the US. Has the Govenor identified any positive aspect of this proposal (beyond it being one way to try to insure the revenue return to the state)? Seems like there are better ways to achieve this, while also providing other benefits.
Does it make more sense, if continuing revenue to a state is the goal, to increase the gas tax gradually by several cents per gallon needed to revenue neutral to the state, generating revenue for the state and giving increasing incentives to the further improvement of miles per gallon efficiencies? An increase in the gas tax would cause those with less fuel efficient vehicles (trucks, pick up trucks, larger SUV's, etc.), to pay more as they continue to use more gallons, rewarding those who are finding more fuel efficient approaches as they use less gallons.
An increase in the gas tax is a quick, low implementation cost solution that can be put in place gradually as a revenue neutral set of steps. It does not require any new equipment, etc to put in place. Also helps in reducing dependency on oil for the US and completely avoids the potentially huge costs of equipping every vehicle and every gas pump with the GPS gear necessary.
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12-31-2008 @ 8:19PM
Therese said...
There are other options that avoid the government creating a record of our every movement on wheels (the GPS tells not only how many miles but where and when.)
It would be far simpler and less intrusive to input the make/model of The EPA estimate of the car's miles per gallon into the pump and compute the tax per gallon based on the estimated number of miles driven for the number of gallons purchased. Face recognition software could be modified to recognize the make and model of the car. Think I should patent this idea :-)
There are other more complex solutions:
In Europe, the price per gallon taxes are high. We could always have an adjustable rate gas tax that adjusts to the base price of the gas to always give a flat rate per gallon that does not over burden the consumer. So when gas wholesale is 2.00/gallon the tax rate could say 1.00 a gallon. The rate could then decrease with increasing price to minimum rate -- say 0.25/gallon. This maintains the consumer's incentive to stay away from gas guzzlers that encourage foreign nations to manipulate our markets and hold us hostage and it automatically lowers the tax rates protecting consumers when there are unexpected spikes in wholesale prices. The base tax rates should be indexed to inflation and based on the mean/average price for the previous year, then the increased or decreased rates could be applied to the 2 sigma standard deviations from those means.
The cost would be programming gas pumps to do the calculations but it beats having the government knowing where you are at any moment.
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12-31-2008 @ 11:19PM
Curious said...
Maybe I'm stupid, but why not cut back on bloated state programs, number of state employee's, unfunded mandates, and all the other waste in Govt?
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