Obama: Pay As You Drive, Instead of Gas Tax?

May 5, 2011

Would we be better off doing away with the federal gas tax, replacing it entirely, or in part, by a pay-per-mile system?

The federal government appears to be in the early stages of finding out. An early draft of the transportation authorization bill from the Obama administration, circulated this week, would require the study and implementation of a plan that would tax motorists based on how far they drive, not on how much fuel they use.

Wouldn't track where you are—just how far you go

The road-tax proposal follows up on a report from the Congressional Budget Office, which in March suggested that electronic equipment—odometer-based, and not necessarily GPS-based—could be used to determine how many miles were driven, then motorists could pay at fuel stations (or perhaps charging stations for EVs).

In the draft—including more provisions for high-speed rail, bicycle and pedestrian paths, and building livability considerations—the administration cites the need to establish a Surface Transportation Revenue Alternatives Office. The office would be part of the Federal Highway Administration, and would "increase public awareness regarding the need for an alternative funding source for surface transportation programs and provide information on possible approaches."

The White House emphasized in a statement that the draft wasn't formally circulated and doesn't necessarily represent the views of the president or the solution that's formally supported by the administration.

Higher-mpg cars, EVs could pinch highway funds

The plan would probably yield more highway funds and would be a more stable answer to concerns that, as consumers move to more fuel-efficient vehicles (and, perhaps, electric cars), available highway funds will become progressively tighter. Raising the current federal 18.4-cent-per-gallon gas tax would be a political non-starter, so a new pay-per-mile method appears to be one scenario that would keep the highway funds flowing.

There are a number of arguments against a pay-per-mile system, however; one is that those heavier, less fuel-efficient vehicles would then pay just as much as those with lighter vehicles—even though the heavier ones would put more wear on the roadways.

Do you think that a pay-per-mile system could work? If you paid your fuel taxes based on miles driven, not by gallons, would it at all affect your vehicle choice? Let us know what you think.

[TheHill.com]

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