More fuel-efficient vehicles aren’t good news for everybody, and state governments are proving to be especially sore about the subject. Taxes on gasoline pay for state highways, and as fuel economy figures improve, the tax revenue that pays for highways is drying up. To counter this a bit, Washington will soon be charging pure-EV owners a $100 annual fee, since they also use the roads but would otherwise pay nothing for their upkeep. It will hardly offset the savings of owning an EV, and there is undeniably a logic to it, even if it does come across as mean-spirited when considering how few of these vehicles there really are.
But the situation is far direr for cash-strapped Virginia, a state where the 17.5-cent per gallon gasoline tax that was set in 1986 wasn’t pegged to inflation. Combined with rising mpg figures, gas tax revenue isn’t helping the state much. So Governor Robert McDonnell has a new proposal to fix this problem, which was published in the Washington Post, getting rid of the gas tax. He plans on raising the state sales tax, as well as the fees for vehicle registration. But there’s another part which just seems odd. He is imposing a Washington-style $100 fee for plug-in vehicles, but is also extending it to hybrids as well. So even though the gas tax, the whole reason for the fee for alternative fuels in the first place, will be repealed, hybrid and EV owners have to pay anyway. This actually means that hybrid and EV owners will be paying more taxes for roads than the owners of gas guzzlers. And don’t think you can get around it by buying an efficient clean diesel either, as the 17.5-cent tax will apply.
It’s fairly amazing that someone could possibly try to sell this idea as fair, but it isn’t law yet and it might not go anywhere. It remains to be seen if a more even-handed solution can be found.