Economy

Taxing your electric car to pay for highway repairs is gaining momentum

Momentum is growing in Congress for some sort of federal tax or fee on electric vehicles.

“Those who use the roads need to contribute to the work that’s being done,” said Sen. John Barrasso, a Wyoming Republican. “And at this point, electric vehicles, which are a growing part of the transportation network, don’t pay anything because they don’t use gasoline.”

Barrasso heads the Senate Environment and Public Works Committee. In July, it approved a $287 billion plan to build and repair highways and bridges — but so far senators have not come up with a way to raise that money.

The traditional funding source has been the tax on gasoline and diesel fuel, last increased in 1993. But as vehicles become more fuel efficient, and electric vehicles become more popular, the government is likely to collect less and less from the fuel tax, the nonpartisan Congressional Budget Office projects.

Barrasso has proposed ending the federal tax credit for electric vehicles and imposing a highway user fee that would be paid when a driver files a tax return.

Many lawmakers supported the idea of making owners of electric vehicles pay for their road use.

“Those driving electric powered vehicles or hydrogen powered vehicles or natural gas powered vehicles, they need to make some payment toward the fund, the transportation fund,” said Sen. Tom Carper of Delaware, the committee’s top Democrat.

Electric vehicles are generally defined as those that must be plugged into electricity to get power. About 2 percent of new car sales last year were electric, and that percentage is expected to grow significantly.

The federal government now provides a credit of up to $7,500 to electric vehicle owners. Barrasso wants to do away with that. “The program has served its purpose; the electric-car market is established,” he argued in a Fox News op-ed.

States have already taken such steps to impose charges on electric vehicles, with 26 having adopted some sort of fee or tax. The Sierra Club says under most proposed fees, electric vehicle drivers would likely pay more than owners of gasoline-powered cars. In 2017, the median electric vehicle fee was about $123 annually, compared with $71 paid in gas tax, the organization said.

Based on what states have done, and what congressional lawmakers are discussing, an annual fee, a tax at charging stations and a tax calculated on miles driven are among the ideas circulating for electric vehicles.

Environmental groups, electric vehicle interests and some lawmakers are aghast, warning that their efforts to promote a clean technology could be suddenly stymied.

“There are a lot of dumb ideas in Washington. Taxing electric vehicles is probably one of the dumbest,” said Rep. Ro Khanna, a California Democrat and House Budget Committee member.

Others cited a clean air argument. “We’re not charging people who use gasoline-powered cars for polluting the climate,” said Gina Coplon-Newfield, director of the Sierra Club’s Clean Transportation for All campaign.

Electric vehicle advocates argue that a tax would discourage, and perhaps reverse, the steady progress this country is making in transitioning from gasoline-powered vehicles.

Miami Gardens Mayor Oliver Gilbert agreed that at some point, “we’re going to have to account” for electric vehicles using roads. But, he said, “I don’t know if this is the time because I think we still want to incentivize more people going electric.”

Gilbert, who chairs the Miami-Dade Transportation Planning Organization, was in Washington recently to testify at a House hearing on transportation strategies for the future.

The trend towards electric vehicle fees in individual states is helping to fuel the push for a federal tax.

The fees and their coverage . Idaho charges electric vehicles between $75 and $140 a year. South Carolina charges $120 every two years for vehicles operated exclusively by electricity, hydrogen or any fuel other than motor fuel.

Probably the most discussed idea in Washington involves taxing miles driven. Rep. Sam Graves of Missouri, the top Republican on the House Transportation and Infrastructure Committee, has long been a vocal proponent of the idea.

The next step in the Senate rests with the tax-writing Finance Committee, where Chairman Charles Grassley, an Iowa Republican, said the idea is worth considering.

He told McClatchy that electric vehicles should pay their “fair share” and “the only thing that’s really gonna be fair along that line… and you aren’t going to institute it right away would be people paying for every mile they use on the highway, whether you have an electric car or a gasoline car.”

Environmental and electric vehicle advocates want to have a dialogue. “Regardless of the form of the solution, it needs to address all users and not penalize the most efficient ones,” said Genevieve Cullen, president of the Electric Drive Transportation Association.

David Lightman is McClatchy’s chief congressional correspondent. He’s been writing, editing and teaching for 47 years, with stops in Hagerstown, Riverside, Calif., Annapolis, Baltimore and since 1981, Washington.
  Comments