DoT Investigating Tax Per Mile

[Catgrrl]

This may sound dumb, but I ask this truly out of ignorance, so bear with me. What about areas that have traffic issues, and mileage isn't really the issue? Like, people in large cities that have short distance commutes but eat up gas waiting in traffic to get home? Would taxes be out of proportion there as opposed to areas with longer distance commutes but not as much traffic time? Or would that be a wash when taking into account all factors? I'd wonder if people who live in rural areas would be paying more for urban area's fixes.

Not that it matters to me anyway, because I'm sure we'll get taxed twice somehow, as local areas will want the gas tax to fix local roads etc. Then add on this mileage tax for federal use.

[GGT]

That's not a dumb question, cat! A tax per driven mile would hurt those driving fuel-efficient cars, since they can drive more miles than others but use less fuel. It would also hurt those who need to live in cheaper (housing) rural areas but drive longer to work in suburban/urban areas.

[Bitter Jeweler]

See my post before cats.

GGT, so wouldn't that reverse the exodus from urban living, and suburban sprawl?

I think the mileage tax, if started out low, wouldn't be more for hybrids. They aren't buying as much gas, so it is made up by the mileage tax. Why did people buy these cars? To avoid buying gas, or to help reduce emissions. They will still save money on gas, because they aren't buying as much, but the tax will be evened out. Why shouldn't they be paying the same tax as a gas car? They still use the road.

[Khendraja'aro]

That's not a dumb question, cat! A tax per driven mile would hurt those driving fuel-efficient cars, since they can drive more miles than others but use less fuel. It would also hurt those who need to live in cheaper (housing) rural areas but drive longer to work in suburban/urban areas.

Again, you'd need to apply multipliers anyway since a 40 ton truck does way more damage to the streets than a VW Polo. Binding such a multiplier to the fuel efficiency of cars would be trivial.

[RandBlade]

See my post before cats.

GGT, so wouldn't that reverse the exodus from urban living, and suburban sprawl?

I think the mileage tax, if started out low, wouldn't be more for hybrids. They aren't buying as much gas, so it is made up by the mileage tax. Why did people buy these cars? To avoid buying gas, or to help reduce emissions. They will still save money on gas, because they aren't buying as much, but the tax will be evened out. Why shouldn't they be paying the same tax as a gas car? They still use the road.

Because gas is a negative externality in a way that electricity is not, so tax is deliberately designed to reduce negative externalities.

If there is a mileage tax, all should pay it, not just those cars that are better for society. That would be totally perverse.

[LittleFuzzy]

Because gas is a negative externality in a way that electricity is not, so tax is deliberately designed to reduce negative externalities.

If there is a mileage tax, all should pay it, not just those cars that are better for society. That would be totally perverse.

And if there's a mileage tax that evens out the difference between the gas tax for "normal" cars and those for hybrids and electrics, it disincentives buying hybrids and electrics.

[Lewkowski]

In order for a mileage tax to work the governments need to know how many miles you drive. Too intrusive.

[Bitter Jeweler]

If there is a mileage tax, all should pay it, not just those cars that are better for society. That would be totally perverse.

Gas cars are effectively paying the mileage tax. If the tax revenue is to build roads, all that use roads should pay a tax, whether one pays for it at the pump, and another through mileage or a combination.

And if there's a mileage tax that evens out the difference between the gas tax for "normal" cars and those for hybrids and electrics, it disincentives buying hybrids and electrics.

I don't think so. The cost of fuel is much higher than the tax, so the gas saving vehicles still have a cost saving benefit.

The fully electric car is only paying a mileage tax, that would be "the same" as a fully gas tax car. Except the fully electric car owner doesn't have to BUY GAS. That is the incentive.

[Bitter Jeweler]

In order for a mileage tax to work the governments need to know how many miles you drive. Too intrusive.

Exactly how intrusive is checking mileage?
Is it any more intrusive than putting a number on a metal plate on your car?

[Khendraja'aro]

Exactly how intrusive is checking mileage?
Is it any more intrusive than putting a number on a metal plate on your car?

Isn't the IRS much more intrusive anyway?

[LittleFuzzy]

I don't think so. The cost of fuel is much higher than the tax, so the gas saving vehicles still have a cost saving benefit.

The fully electric car is only paying a mileage tax, that would be "the same" as a fully gas tax car. Except the fully electric car owner doesn't have to BUY GAS. That is the incentive.

They're also more expensive up front and the infrastructure supporting them is significantly more threadbare. If you want to encourage people to move away from "normal" gas vehicles, you don't want to create a mileage tax right now.

[Bitter Jeweler]

I am sorry, but I don't see people buying hybrid as a way of getting around paying taxes, via gas tax. Of the people I know who bought them, THAT was never mentioned.

Then it comes down to a gas tax being a sin tax, of the likes that built stadiums in my town. If electric and hybrids can't be taxed, then one group is supporting the infrustructure for another group.

Who is going to pay for the infrastructure for electric cars? Will there be a pay at the plug tax for roads?
Somebody has to pay for all this shit.

[LittleFuzzy]

I am sorry, but I don't see people buying hybrid as a way of getting around paying taxes, via gas tax. Of the people I know who bought them, THAT was never mentioned.

Then it comes down to a gas tax being a sin tax, of the likes that built stadiums in my town. If electric and hybrids can't be taxed, then one group is supporting the infrustructure for another group.

Who is going to pay for the infrastructure for electric cars? Will there be a pay at the plug tax for roads?
Somebody has to pay for all this shit.

They're doing it as a way of getting around paying for gas, and part of the price of gas is the gas tax. And people certainly are or should be budgeting the costs of taxation when considering total related expenditures, as part of figuring out what car they should buy.

[wiggin]

I am sorry, but I don't see people buying hybrid as a way of getting around paying taxes, via gas tax. Of the people I know who bought them, THAT was never mentioned.

Then it comes down to a gas tax being a sin tax, of the likes that built stadiums in my town. If electric and hybrids can't be taxed, then one group is supporting the infrustructure for another group.

Who is going to pay for the infrastructure for electric cars? Will there be a pay at the plug tax for roads?
Somebody has to pay for all this shit.

Once gas consumption drops to the targeted equilibrium levels, obviously revenues will have fallen as well. The best ways to then fund infrastructure are to tax things we specifically want to decrease. Congestion is the easiest target: have high taxes (i.e. tolls) for use of roads in high demand at peak hours. People who use alternates or stagger their hours are effectively 'paying' for infrastructure by reducing maximum load, traffic jams, etc. It's also possible to tax people who use more expensive pieces of road infrastructure that are extremely limited in total traffic - i.e. bridges, tunnels, etc.

Now, if we determined that raw mileage was the most important thing we wanted to decrease, obviously that's a valid target for taxes. Yet I really doubt that's the case. Mileage is in general something we'd want to keep down to reduce overall energy consumption and wear and tear on roads, but it doesn't necessarily directly scale. Use of high-traffic streets in city centers for only a few miles a day may cost more in upkeep (and other economic costs) than a 20 mile commute on a lightly traveled interstate at off-peak hours. Mileage is a very nonspecific metric to reduce when there are much clearer evils to be taxed away first.

[Dreadnaught]

Saw a great at on this thread for gasoline hedging. Interesting...

But yeah, this seems like it's way more complicated than a gas tax. But I think the fact that our gas taxes aren't paying for roads begs the question of whether all the roads slated for construction/repair are actually necessary.

[wiggin]

But yeah, this seems like it's way more complicated than a gas tax. But I think the fact that our gas taxes aren't paying for roads begs the question of whether all the roads slated for construction/repair are actually necessary.

I'm not sure why that question follows at all. The gas tax isn't based on a percentage or indexed to inflation or anything else - it's just a flat tax per gallon of gas. That means its purchasing value has been eroding over time, at the same time that gallons of gas per vehicle has been (generally) dropping due to improving efficiencies. Even if it theoretically was enough to pay for infrastructure when the tax was enacted, there's no reason to believe that it should pay for it now, or that it can in the future.

In terms of 'necessary costs', we have similar amounts of investment in new roads/infrastructure as other Western countries, but drastically lower funds spent on upkeep. It's possible we could slightly save by more efficient infrastructure planning, and could probably save a lot by better urban planning, but it's doubtful our current 'upkeep' budget is even remotely sufficient.

[Dreadnaught]

I understand the purchasing power erosion. Has gasoline consumption itself gone up though? My issue is more about the costs and amounts of roads increasing disproportionately due to bad urban planning, pork barrel spending, etc.

[wiggin]

Gasoline consumption has been flat or dropping, even in booming economic times. For example, see the EIA piece quoted here: http://americanfuels.blogspot.com/20...nsumption.html

I agree that poor infrastructure planning is part of the cost, but upkeep of existing (and expansion of necessary) infrastructure is far more costly than the current money allocated for it.

[Flixy]

Gas cars are effectively paying the mileage tax. If the tax revenue is to build roads, all that use roads should pay a tax, whether one pays for it at the pump, and another through mileage or a combination.

I suppose it would be more fair if the gas tax is only for the negative effects caused by gas use (e.g. pollution, etc.), and to discourage gas use, while an even mileage tax for all vehicles pays for the roads. You could differentiate between vehicle weight though, heavy vehicles damage the roads more.

Exactly how intrusive is checking mileage?
Is it any more intrusive than putting a number on a metal plate on your car?

Would checking mileage alone be a good way? If it's on a federal level, maybe - but if it's on a state level, why would you have to pay mileage taxes for state A's roads while you were driving mostly in state B? Over here that is a good reason why it won't work, and will need to have severe privacy intrusion, people drive across borders all the time and you should only pay for miles driven in your own country.

[Wraith]

Tolls are an easier fix that's less intrusive, doesn't disrupt traffic much (now that electronic systems are in place), and is largely already implemented across large parts of the nation's infrastructure.

Compared to the checking the odometer anually thing, I'd say they're more intrusive. The odometer only tells you how far you've gone, tolls would tell you where you've gone to. A huge toll infrastructure would seem to be more expensive to implement, and counter-productive to your goal of fighting traffic congestion. Post gas tax, I think your goal of fighting congestion would be better served by on-board tracking. Not sure if it's worth the added cost, though, so maybe tolls are a better solution.

Also, I'm not sure that we should be charging a use fee for our infrastructure. It's a common good that generally improves commerce, so there's a lot of knock-on effects that benefit people even if they aren't heavily using our infrastructure. Perhaps a better system would be folding into general spending and revenue instead of having a separate trust (this means we could fund it from more general consumption taxes and the like instead of having a cumbersome mileage system for no particular reason). I'm not 100% sure on this, though, since overuse could still be a problem. More generally, we need to change urban planning and zoning and the like to reduce our reliance on highways, which would lower our infrastructure costs and transportation costs for people.

I'd be just fine with rolling this into general taxes.

One more point: the energy grid is obviously going to come under more stress as we electrify private transport in the country. There's multiple ways to solve this, but again we come to two separate problems: infrastructure funding and pollution. Pollution can be dealt with by a carbon tax or other pollution tax, which is the least of all evils to deal with things, and doesn't subsidize a specific form of cleaner energy (something that is a REALLY REALLY bad idea to do economically). Infrastructure spending can be done by providing incentives for off-peak consumption through taxes or lower rates (e.g. only charge your car when no one else is using the grid) and in general bringing energy prices into a more dynamic pricing scheme than the rigid setup currently in place in most US utilities.

There was some work done before that could be used to turn electric cars into batteries for the energy grid. The idea is that during the day, you can have plugged-in vehicles to feed into the grid instead of drawing from it, and then they charge at night when other consumption is lower. There's a financial incentive to do this for anyone in a place with a smart grid. This isn't very viable right now with current electric vehicles, but maybe in the future it could work out.

You do realize that mileage taxes don't need to do more than look at your odometer every month or whatever, right? We don't need some GPS chip tracking your car's every movement - that would be a gross violation of privacy.

If they're just reading the odometer once a year, that doesn't seem too invasive, but it also seems very likely to lead to cheating. I'd really like to avoid any sort of onboard tracking.

Both possibilities were floated. Tracking would be done to do something like your toll idea, where the rates vary with time/place travelled, to add the benefit of helping with traffic congestion.

[Wraith]

Gas cars are effectively paying the mileage tax. If the tax revenue is to build roads, all that use roads should pay a tax, whether one pays for it at the pump, and another through mileage or a combination.

Yes, but, fuck gas cars. We should be incentivizing the move to anything else as much as possible. An electric-only mileage tax reduces incentive for switching.

Would checking mileage alone be a good way? If it's on a federal level, maybe - but if it's on a state level, why would you have to pay mileage taxes for state A's roads while you were driving mostly in state B? Over here that is a good reason why it won't work, and will need to have severe privacy intrusion, people drive across borders all the time and you should only pay for miles driven in your own country.

It's probably a wash. You pay in the state you're registered in. There'll probably be roughly as many people who wind up paying state A for travel in state B as vice versa. Any discrepancy probably wouldn't be a big enough deal to worry about.

[littlelolligagged]

I say raise all the taxes massively, encourage mass-transit.

You know, make it so that it is convenient for me to take a bus or train to wherever I might want to go?

[wiggin]

Compared to the checking the odometer anually thing, I'd say they're more intrusive. The odometer only tells you how far you've gone, tolls would tell you where you've gone to. A huge toll infrastructure would seem to be more expensive to implement, and counter-productive to your goal of fighting traffic congestion. Post gas tax, I think your goal of fighting congestion would be better served by on-board tracking. Not sure if it's worth the added cost, though, so maybe tolls are a better solution.

I guess we have different definitions of 'intrusive' and 'expensive'. The point is that tolls already exist and are largely accepted by the US public. Expanding the infrastructure is a lot easier than starting up a whole new one, and it will not get as much resistance from privacy advocates. Also, tolls normally have a cash option which completely eliminates concerns about tracking.

As for congestion, tolls don't actually add much if any when implemented properly. This is greatly aided by electronic tolling.

There was some work done before that could be used to turn electric cars into batteries for the energy grid. The idea is that during the day, you can have plugged-in vehicles to feed into the grid instead of drawing from it, and then they charge at night when other consumption is lower. There's a financial incentive to do this for anyone in a place with a smart grid. This isn't very viable right now with current electric vehicles, but maybe in the future it could work out.

Yeah, I've seen that argument. It would be challenging to implement, but might work.

Both possibilities were floated. Tracking would be done to do something like your toll idea, where the rates vary with time/place travelled, to add the benefit of helping with traffic congestion.

Nah, tolls could just have 'gatekeepers' at various high-use regions rather than a comprehensive tracking system. I think it's clear we want to eliminate any need to have real-time GPS tracking of cars.

[Khendraja'aro]

Tolls are not the solution. If you look at the road map of any bigger town, country or state, you'll be quickly disabused of the notion.

Tolls work if you have defined entry- and exit points like the German Autobahn, French Highways, bridges, tunnels and the like.

They do not work on a massively interlocked grid where you can drive around toll stations simply by taking a side road - or you have to make them ubiquitous which leads the concept ad absurdum.

[GGT]

You know, make it so that it is convenient for me to take a bus or train to wherever I might want to go?

Trains!

Khen, we do have some defined entry/exit toll roads. We call them Turnpikes on the east coast. We also have some tunnel and bridge toll booths. Wouldn't call it very coordinated, though.

We have "weigh stations" on several highways, where 18 wheel trucks were required to stop and pay fees based on carried weight of their cargo, but it's been years since I've seen one being actively used.

[GGT]

See my post before cats.

GGT, so wouldn't that reverse the exodus from urban living, and suburban sprawl?

Sorry, missed your post Bitter. Two things are at work here---one is discouraging gas consumption, the other is paying for automobile infrastructure. I suppose we could find one way to deal with both, but so far it's not looking that way. Dunno, if you drive a light weight gas-sipper, a hybrid or electric car --- a gas tax seems more "equitable" than an axel or mile-driven toll fee, where the heavier SUVs pay the same but chew up asphalt faster. Then again, I've heard those with heavy 4 wheel drive vehicles complain about little cars needing the snow removal and salt spreading, that also chews up the pavement (and uses tax dollars).

If we want to reverse ex-urban sprawl or long commutes, that seems more like an affordable housing and/or zoning and property tax issue to me.

[wiggin]

Tolls are not the solution. If you look at the road map of any bigger town, country or state, you'll be quickly disabused of the notion.

Tolls work if you have defined entry- and exit points like the German Autobahn, French Highways, bridges, tunnels and the like.

They do not work on a massively interlocked grid where you can drive around toll stations simply by taking a side road - or you have to make them ubiquitous which leads the concept ad absurdum.

Obviously you wouldn't have tolls on every street corner. It would just be placed on limited access highways/bridges/etc. and potentially along particularly congested routes in the urban center. It's not terribly difficult to implement, since it already exists to a large extent. It's also possible to have a congestion charge for entering a cordon area, though that takes a little more effort. It already works in a handful of cities, so it's clearly doable.

There's always ways to avoid tolls - take local/slower/less direct routes, change your timing, etc. But these avoidance behaviors all do what the toll is supposed to do - reduce congestion. So one way or the other, people pay for it.

[GGT]

wiggin, does the Region still have those coin-toss tolls between Indiana/Illinois/Wisconsin highways? Last time I drove those routes I was a passenger and didn't pay any attention. It used to be a dime. I thought the purpose was to pay for road maintenance and repair....not to reduce congestion.

Come to think of it, an area of VA around DC has a strange section of federal highway that ONLY accepts plastic cards or one of those EZ pass monitors. No human gatekeepers or a cash option. I got lost once at nighttime and missed the sign warning "Exit requires electronic payment" (or whatever it said). Kind of a nightmare, really, trying to figure out how to get the hell off a highway that seemed to go on forever with few exits. Eventually I had to swipe my credit card for a $2.50 charge.

[Wraith]

Obviously you wouldn't have tolls on every street corner. It would just be placed on limited access highways/bridges/etc. and potentially along particularly congested routes in the urban center. It's not terribly difficult to implement, since it already exists to a large extent. It's also possible to have a congestion charge for entering a cordon area, though that takes a little more effort. It already works in a handful of cities, so it's clearly doable.

There's always ways to avoid tolls - take local/slower/less direct routes, change your timing, etc. But these avoidance behaviors all do what the toll is supposed to do - reduce congestion. So one way or the other, people pay for it.

And if enough people do it, it creates congestion elsewhere. If we move to tolls as a major funding tool, prices would probably wind up fairly high, increasing the incentive to move around congestion spots. You can set up tolls in these new areas too, and good times will be had chasing the dancing high-traffic areas until we wind up with tolls collected everywhere, and all the attendant higher traffic pattern implications (people who pay cash to avoid privacy violations screw things up the worst). Khen raises good points. I think I'm souring on the idea.

[wiggin]

wiggin, does the Region still have those coin-toss tolls between Indiana/Illinois/Wisconsin highways? Last time I drove those routes I was a passenger and didn't pay any attention. It used to be a dime. I thought the purpose was to pay for road maintenance and repair....not to reduce congestion.

Yes, the Tri-state tollway has tolls, but most of the expressways in the Chicago area (including the Kennedy/Dan Ryan and LSD which get VERY congested) don't.

And if enough people do it, it creates congestion elsewhere. If we move to tolls as a major funding tool, prices would probably wind up fairly high, increasing the incentive to move around congestion spots. You can set up tolls in these new areas too, and good times will be had chasing the dancing high-traffic areas until we wind up with tolls collected everywhere, and all the attendant higher traffic pattern implications (people who pay cash to avoid privacy violations screw things up the worst). Khen raises good points. I think I'm souring on the idea.

There are dynamic pricing strategies to keep traffic at a reasonable level (i.e. to reduce congestion just enough at a given time to collect revenues without sending people en masse to other routes). There's also the aforementioned 'express lanes' that encourage either HOVs, buses, or a high, dynamic toll. This has been successfully piloted in a number of places.

Furthermore, people won't go indefinitely out of their way to avoid tolls - there are generally only a few logical routes from one place to another.

Think of this as a mismatch between supply and demand. There's a limited amount of convenient infrastructure to get from point A to point B. The number of people who want to use that infrastructure is higher than the infrastructure can really handle, but the infrastructure is provided essentially free on a marginal cost basis. This causes overconsumption. Increasing the marginal cost of travel on overloaded roads reduces demand by a variety of avoidance behaviors, and brings in revenue that can be used to upgrade the overall throughput from point A to point B to match equilibrium demand levels.

A classic example is free (or very cheap) street parking in American cities. When prices were jacked up to meet actual demand for parking spaces, people made other arrangements rather than pay the ridiculously high price. This has a lot of positive benefits - it brings in revenues that can be used to alleviate parking or other congestion/infrastructure problems (or subsidize public transit, which effectively alleviates parking pressure). It matches people who get the highest marginal utility out of a parking space with the space (when previously it was essentially a lottery process rather than a pricing process). It reduces congestion due to people looking for spots.

The same basic logic works for any congestion pricing.