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Draft Proposal Would Create Agency To Tax Cars By the Mile
theodp writes "The Hill reports that the Obama administration has floated a transportation authorization bill that would require the study and implementation of a plan to tax automobile drivers based on how many miles they drive. The plan is a part of the administration's 'Transportation Opportunities Act,' and calls for spending $200 million to implement a new Surface Transportation Revenue Alternatives Office tasked with creating a 'study framework that defines the functionality of a mileage-based user fee system and other systems.' The office would be required to consider four factors — the capability of states to enforce payment, the reliability of technology, administrative costs, and 'user acceptance' — in field trials slated to begin within four years at unspecified sites. Forbes suggests the so-called vehicle miles traveled (VMT) tax should be called the Rube Goldberg Gas Tax, because while its objective is the same as the gas tax, the way it collects revenue is extremely complex, costly and cumbersome." The disclaimers are thick on the ground, though; note, this is an "early draft," not pending legislation.
It will never pass the house.
“This is not an administration proposal," White House spokeswoman Jennifer Psaki said. "This is not a bill supported by the administration. This was an early working draft proposal that was never formally circulated within the administration, does not taken into account the advice of the president’s senior advisers, economic team or Cabinet officials, and does not represent the views of the president.”
Not quite the same as the summary...
What is the difference between this and the already-in-place fuel tax? The fuel tax is even better at metering costs to those that chew up roads (heavy vehicles). This sounds like a solution looking for a cause to me.
The wheel is turning, but the hamster is dead.
Comment removed based on user account deletion
I wouldn't. A consumption-based tax practically balances itself. The heavier vehicles create more wear due to their greater mass and they pay more into the tax fund because they consume more fuel to move that mass around. There's nothing to calculate or measure or derive. Vehicles are taxed according to their impact on the infrastructure. I realize it's not an absolute "prefect justice for all" scenario but there's very little bureaucracy involved in the current scenario so it should cost very little to implement (or, in this case, maintain). XX cents per gallon consumed. Done. All-electric and alternative fuel vehicles are such a small percentage that it's not worth the hassle of worrying about them at this point.
Perhaps the answer is to tax cars by calculation of fuel economy, weight, engine size, tank size etc. and stick them in various bands, e.g. A-F with A being most efficient, F being worst. Don't tax anyone in A and punitively raise the tax from bands B-F. People will buy more fuel efficient vehicles just to avoid the hassle of paying taxes on them.
Basically there is a deficit, it has to be cut and the national debt has to be reduced. Social security has to be saved as well. This means only one option, we must raise taxes or die.
So then close all the corporate tax loopholes and have them pay their fair share. Stop letting companies like Google, Microsoft, IBM, etc get away with playing shell games to avoid taxes.
The whole thing makes no sense. Usually we use taxes to create incentives and disincentives, nudging the public in a direction determined by government.
By taxing gas you create an incentive for people to drive fewer miles and to use more efficient vehicles. I presume these are both aims of government.
Taxing per mile means there is no penalty for using an excessively large vehicle with poor fuel consumption over driving a smaller car that uses less fuel. I don't see any government implementing it in that simple form. It might be different if the proposal were to include bands for vehicles based on fuel consumption or emissions, with higher per mile charges for inefficient vehicles.
One disadvantage of taxing gas consumption or pollution is that we don't usually know how many people are in a vehicle. As a result, a family of six traveling in a minivan may be penalized at the same rate as an individual driving an SUV that has similar gas consumption.
Just have drivers self report it and make it one of the things that gets verified in the event of an audit. Make the fines and fees exactly the same as if the person had cheated on their taxes some other way. If a car is sold, have a way for the buyer and seller to, independently of each other, submit the mileage at the time of sale and if there's a significant discrepancy have the new owner take it down to the DMV within 30 days to have someone there record it.
Honestly, I don't have any problem with a per mile tax but I have a huge, huge issue with any kind of device being placed on my car. Not only is it an incredibly invasive invasion of privacy, it's also way more expensive and complex than any taxing method should be.
No kidding. Before you know it, they'll make auto-insurance required by law, just like health insurance!
It is a shame that they no longer teach in schools the difference between state and federal governments and the division of responsibilities accorded each based on the US Constitution. That's got to be the only reason such a stupid comment like this would appear here.
For the sarcasm impaired: the auto insurance laws are STATE laws that require coverage to protect THE OTHER GUY sharing the road with you; the new health insurance law is a FEDERAL LAW that nobody could bother to read before they voted on it that applies to everyone except those who have enough political clout to get exempted from it.
The other difference is that the AUTO insurance laws don't force insurers to cover every trip to the mechanic or replacement of worn out parts, while the HEALTH insurance law does.
And you know why we're getting this stupid idea? Because of the American Public's obsessive opposition to a proper gas tax. Grow a pair, and start to accept that a gas tax is the simplest, most obvious way to fund the highway system. And if anyone's worried that trucks will be driven into the ground because of inordinate gas prices, you could even have a tiered system at the pump, where someone who purchases 100 gallons in one block pays a different tax than someone who purchases 5 gallons. But this approach is the single worst way of getting people to fund the maintenance of the roads. And anyone who complains about this better first look in the mirror to check whether you are willing to support paying for infrastructure to begin with. Because the reason this is even considered is that a gas tax is demonstrated political suicide.
Those who can, do. Those who can't, sue.
Trucks should pay even more. They do the most damage to the road. If that is too expensive than let goods go over roads the companies pay for. You will find they choose nice smooth steel roads and steel wheels.
Usually we use taxes to create incentives and disincentives, nudging the public in a direction determined by government.
The purpose of taxes isn't to control behavior or restrict personal choice, it's to raise revenue. Of course, lobbying groups try to move taxation to where it least affects them OR to impose their social agenda on others -- but that's not the purpose of taxes, it's just a natural side effect that yields our ungainly tax code.
Why is there an "insightful" mod and why isn't it "-1"? If I wanted insight, I wouldn't be reading
The problem isn't taxing for road usage(in fact, were it not for the culture that you mention, such a proposal would theoretically be equally desireable for conservatives(who tend to like "users fees" because they dislike taxes and dislike the possibility that people might end up being subsidized)) and liberals(who tend to suspect that individual-vehicle transport, especially the petro kind, has been the recipient of massive, if not overt, subsidies for pretty much the entire post WWII period, making possible an entire suburban material culture that cannot exist without those subsidies).
The problem with mileage taxes is with administration, enforcement, and mission creep. Unlike, say, fuel taxes(which have the fairly convenient advantage of approximately taxing a composite of vehicle size and vehicle miles traveled, which is a good rough estimate of vehicle road 'consumption', without ever having the tax man leave the shop), mileage taxes require, at bare minimum, the tax man inspecting every vehicle's odometer(or at least a sufficiently large sample that most people report theirs honestly on the 1040v.2). If mission creep or ulterior interests come into play, you could pretty easily end up with GPS black boxes, or other less tweakable(you don't even need to crack the odometer, just ensure that the rotations to miles conversion it is using is based on slightly smaller wheels than you are using) methods.
Employing an overhead-heavy, potentially very invasive, taxation strategy when a simple retail sale tax one would work nearly as well strikes me as a serious problem. The notion that, while many roads are basically natural monopolies, and thus cannot be run on free market lines, one can attempt to make one's payment for road use approximately proportional to their use of roads seems entirely sensible.
Because mass of the vehicle has a hell of a lot to do with how much damage they do. Mass per axle needs to be taken into account as well as total distance driven.
Which kind of brings us back to the idea of this as basically a more complicated equivalent of a gas tax...
I mean, heavier vehicles will tend to have poorer fuel economy, and obviously if you drive farther you use more gas. If you accept also that it's desirable to encourage people to drive more efficient vehicles when possible, then it really seems like a gas tax is the way to go.
But it's unpopular to do anything that raises the price of gasoline. I suspect that may be why they're looking at alternatives. Tax basically the same thing, but measure it differently so people won't curse you every time they go to a gas station.
Bow-ties are cool.
Fact, the Federal Gasoline Tax was last raised in 1993, not the 1980s.
Fact, 40% of the Federal Gasoline Tax doesn't go to transportation construction or maintenance, but to Federal Budget earmarks.
Cripes, it wants the government to buy and install a bazillion fancy devices and install them on every car in the country? Well, I know one company that would like to see it pass...
Why is it this stupid idea reappears every 6 months or so? Every time it involves some expensive piece of hardware (GPS receivers for instance) that needs to be bought and installed on all umpteen million cars in the country, instead of the far more sensible solution of just having the yearly inspection guy write down the mileage off of the odometer every time you bring your car in and report that along with your results to the government. It won't work in states that don't do safety inspections, but they could work something out (owner just self reports for instance) that's about a billion times cheaper than whatever technological solution someone is trying to create a market for.
I read the internet for the articles.
Conservatives have the reverse problem, they tend to see taxation in infinitely flexible terms. They think cutting taxes will somehow raise more money, as if because rates went down, people are suddenly more willing to part with their money. Life is way more complicated than that.
Wealth doesn't flee unless it has someplace to go. Businesses may spend more. People may actually hire more when taxes are higher. Unintended consequences can be quite complex and counter-intuitive on both sides.
If business taxes are levied on profits then when taxes are high, expenses are effectively subsidized by the taxes the business would have paid on it's profits. If you would lose 33% of your dollar anyway, it's effectively the same as having the cost reduced by 33%. Thus growing your business may be more attractive than distributing dividends to the owners or bonuses to the executives. This is particularly true if capital gains are taxed at a lower rate than dividends and bonuses. And of course, if employee wages are an expense then profit taxes effectively subsidize employment.
Fanatically anti-fanatical
The fuel tax already covers that nicely. Truckers are using the most expensive fuel. According to the US Department of Energy, both gasoline and diesel are taxed at 12% average. The average cost of regular gasoline is $3.56/gal. The average cost of diesel is $3.91/gal.
According to the Bureau of Transportation Statistics (in 2008 numbers), the average passenger car gets 22.6mpg, and the average other 2 and 4 wheel vehicle (motorcycles, passenger trucks and SUVs) get 18.1mpg. That's average, everyone will claim "mine gets [higher|lower]".
A tractor/trailer rig gets 10mpg unloaded, or about 5 to 7mpg fully loaded. so, on a hypothetically average trip of exactly 1,000 miles, and equally average driving conditions for all involved...
Avg passenger car: Fuel: 45 gallons. Cost: $160.20 Tax: $19.22
Avg tractor/trailer Fuel: 167 gallons. Cost: $652.97 Tax: $78.36
And lets address his complaint of "In fact the (highway) road damage of one 18-wheeler is equivalent to at least 9600 cars", lets consider what the car to truck ratio is...
Again, according to the Bureau of Transportation Statistics, in 2000 (the last year this report shows any numbers), there were 133,621,420 passenger cars, 4,346,068 motorcycles, 79,084,979 passenger trucks and SUV's, and 5,926,030 other 2 axle vehicles.
So, 222,978,497 2 axle vehicles, and 2,096,619 truck/trailer combination. So 106 cars for every truck on the road. Consider that those heavy trucks spend far more miles on common routes, (i.e., interstates, state highways, etc) than on the sprawling local roads and community streets. You'll see that it doesn't matter much that they do 9600:1 damage to the highway, they are likely only driving on a very very small percentage of the overall roadways. They only have to repave an interstate once and it's repaired, so the cumulative effect does not equal a 9600:1 burden on the overall paved streets across the country.
Consider your own neighborhood. How many cars drive past your house for every heavy truck. The number probably becomes tens of thousands or hundreds of thousands to one truck.
But don't let factual statistics get in the way of cherry picking numbers to scream about the awful blight of the heavy truck. :)
Serious? Seriousness is well above my pay grade.