Replacing the Gas Tax

The per-gallon gas tax has not kept up with inflation, and as vehicles once again become more fuel-efficient (or run on electricity) and people drive less, the highway fund struggles to keep up. Officials in Oregon have been looking for a way to replace the per-gallon gas tax for about a decade. In particular, they have been considering a mileage-based tax under which roadway users would pay for how much they use the roads, rather than how much gasoline they buy.

This story from the blog features an interview with the manager of Oregon’s Road User Fee pilot program. The program has been exploring several mechanisms and structures for collecting a mileage-based fee from roadway users. After a few failed pilots, they think they have the program figured out and that it can pass through the Oregon legislature this year for implementation by 2014. Some features of the proposed system are:

  • platform independent and able to evolve with technology
  • a fee of 1.56¢ per mile (based on $0.30/gal tax and 21 mpg vehicle)
  • flexible payment options
  • GPS not required
  • option for paying a flat annual fee for a mileage limit
  • online reporting options

In spite of the several pilots and long evolution of the proposed system, much skepticism remains about the ability of the program to function, let alone gain approval by the Oregon legislature. Either way, this is a great example of states acting as “laboratories of democracy” attempting to find solutions to nation-wide problems, whether they succeed or not.

What do our readers think about a mileage-based tax? Is it more fair than a fuel tax? Will it provide the funding needed to maintain our roads? Is it politically feasible?

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