Once again, the rapacious Democrats in California are proposing a new tax, this time targeting car owners by charging them for each mile they drive.
The plan to extract more money from the state’s struggling citizens isn’t merely up for debate. A pilot program called the “2024 Road Charge Collection Pilot” is already underway. In this program, car owners install a device in their vehicles to monitor their driving and calculate a tax based on mileage.
Reportedly, the new method of collecting road taxes is set to replace California’s high gas taxes. According to the financial website Motley Fool, California currently imposes the second-highest gas taxes in the nation at 51 cents per gallon, with only Pennsylvania surpassing it at 56 cents per gallon.
One logical reason for contemplating the new tax scheme is the changing landscape of vehicle usage. With an increasing number of people adopting hybrid or electric vehicles, states anticipate a decline in revenue from gasoline taxes. Since most states rely on gas taxes to fund road maintenance and repairs, this presents a dilemma. Policymakers are left wondering: if fewer people are purchasing gasoline, where will the necessary funds for road maintenance come from?
Admittedly, this dilemma may seem somewhat distant in the future. According to the latest data from the U.S. Energy Information Administration, hybrids and electric vehicles accounted for 16 percent of light-duty vehicle sales in 2023.
However, 16 percent is a significant number. Moreover, all those drivers are contributing less, or even nothing, in gasoline taxes.
Therefore, it’s understandable that states are exploring alternative methods of taxing drivers to ensure road maintenance. The Vehicle Miles Traveled tax emerges as the latest approach in this pursuit of revenue.
However, a per-mile tax appears to be an exceedingly intrusive and inequitable approach to vehicle taxation. The term “intrusive” accurately captures the privacy concerns associated with these schemes.
California’s pilot program offers various versions. In the most straightforward iteration, drivers begin by uploading a photo of their odometer to initiate the program and then submit another photo at the end of the taxing period. Subsequently, the state calculates the tax based on the mileage recorded in the photos.
However, this raises a question: What happens to the miles a driver has accumulated while driving out of state? And why should that driver be subject to a tax in California for driving in another state? This is where the next version of the collection system becomes intrusive.
The comprehensive system requires drivers to install a device that links to the car’s computer system, which subsequently transmits GPS and other vehicle data to the state. This entails the state device monitoring every aspect of drivers’ movements. California has even introduced a third system that taps into vehicle telematics sent from cars to manufacturers, granting the state access to all data stored in a car’s computer.
According to LAist, the state asserts that the benefit of this system is the ability for the government to determine when a driver is traveling out of state, allowing them to exclude those miles from the taxation scheme.
Drivers will face a choice regarding whether they’re comfortable with the government having complete access to their data and the ability to track their movements at all times. However, it’s easy to anticipate a future where there’s no choice in the matter, and all vehicles will be equipped with these intrusive reporting systems, regardless of owners’ preferences.
The per-mile taxing scheme presents numerous issues. Beyond relinquishing your freedom from government tracking while traveling, it’s also an inherently unfair tax in various respects, as highlighted by the Texas Public Policy Foundation.
Firstly, it penalizes residents living outside major urban hubs, as they often have longer commutes to work, church, grocery stores, and recreational activities. Additionally, it places a disproportionate burden on lower-income families residing in these rural regions.
Moreover, VMT taxing schemes incur higher operational costs, as the tracking systems are typically managed by third-party companies. Consequently, states must bear significant processing and maintenance expenses to sustain tax collection. Additionally, this setup exposes drivers to potential fraud from unscrupulous tax-collection firms contracted by the state.
Texas Policy added that VMT taxes “also discourage driving, which will inevitably hurt employment and upward mobility. Both [gas and VMT] taxes increase the price of consumer goods and have a negative impact on economic growth.”
Oregon, Virginia, and Utah are also considering pilot per-mile vehicle taxing schemes, following California’s lead.
There are numerous reasons why VMT schemes are deemed a problematic, un-American concept, stifling freedom of movement, imposing undue burdens on lower and middle-income Americans, and susceptible to abuse. However, it’s unsurprising that the Democrat-controlled state of California is contemplating such measures.
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