Tax-per-mile legislation up for debate in Congress

Woodland Park, Seattle
CC BY 2.0 Seattle Municipal Archives

House Representative Earl Blumenauer (D-Ore.) has proposed legislation that could lead to taxing U.S. drivers based on how many miles they drive, instead of by how many gallons of gas they use. The bill funds research into tax-per-mile methods, to help determine how the change should be introduced.

Blumenauer's bill, the Road Usage Fee Pilot Program, aims to find new sources of revenue to maintain the nation's highway program. A major source of funding for the highway is a gas tax, which is currently 18.4 cents per gallon. That tax has not been raised since 1993, and the general treasury has moved $50 billion to the Highway Trust Fund.

The Washington Post reports:

“Congress hasn’t dealt seriously with the funding issue for 20 years,” Blumenauer said. “With inflation and increased fuel efficiency, especially for some types of vehicles, there is no longer a good relationship between what road users pay and how much they benefit. The average motorist is paying about half as much per mile as they did in 1993.”
Although the vehicle-miles-traveled (VMT) system wouldn't be implemented immediately, the bill includes a short-term increase on gasoline taxes that would raise the price per gallon by 15 cents.

Blumenauer's home state is planning to test such a program. Starting in 2015, some 5000 volunteers in Oregon will switch from the state's 31 cents-per-gallon tax to a 1.5 cents-per-mile tax.

Critics say that a per-mile tax does nothing to encourage people to buy greener or more fuel-efficient cars, although it might motivate some to drive less. NBC reports:

"Dealing with climate change is not a top priority of Oregon's transportation planners," said Steve Woolpert, professor of politics at Saint Mary's College of California.
Some view the VMT as a means of addressing an unfairness in the system as people opt for more fuel-efficient vehicles—for example, that Prius drivers end up paying less for road infrastructure than their gas-guzzling counterparts. Woolpert thinks that's a wrongheaded argument. "(VMT) will weaken incentives for buying fuel-efficient vehicles. … It is unfortunate that Oregon is pursuing a VMT rather than a comprehensive response to climate change."

Others worry that if a tax-per-mile system is not pegged to inflation, it will face the same problems of the current system.

The Hill reports that Blumenauer tried to introduce similar legislation in 2011, but it was strongly opposed by conservatives.

Tax-per-mile legislation up for debate in Congress
Should taxes be paid by the mile or gallon?