Minnesota considers new tax based on mileage driven

April 25, 2019

Minnesota will mull a different way to tax drivers in the state over a potential increase to the gas tax: a mileage tax.

According to a report from Alpha News last week, Democratic Rep. Raymond Dehn has proposed a tax based on the miles an individual drives. His new piece of legislation would authorize a study that the Minnesota Department of Transportation would conduct on how to phase a mileage tax into the current tax system.

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The proposal is different from a more standard call from Governor Tim Walz. The governor proposed a 70 percent gas tax increase, which equates to an extra 20 cents per gallon pumped. Per the report, the increased taxes come as the state entered 2019 with a $4 billion budget surplus.

Where Rep. Dehn's legislation could face backlash is the way the study would collect data to calculate miles driven. The representative said a GPS transponder would be plugged into a vehicle and communicate with a smartphone application. The state government would receive the mileage data and nothing else, Rep. Dehn said. That surely won't stop privacy advocates from crying foul over the intrusion.

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The bill was last sent to the Transportation Finance and Policy Division and will still need to hurdle committees and mark-ups before a vote will be held on the matter.

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