The Obama administration is floating a draft transportation authorization bill that would require the study and implementation of a plan to tax automobile drivers based on how many miles they drive.
I wrote about this issue for the Capital Journal in December 2004: Download Riden_with_tax _collector
Mary Peters, Federal Highway Administrator for the Transportation Research Board in Washington D.C., acknowledged the problem at a January highway finance session, saying, "The bottom line is we cannot depend on fossil fuel-based taxes in the future." Peters suggests the solution to declining revenue is a "public utility model where we pay for what we use, based on the time of day we use it, and how many other people want to use it." In effect this would be a market-based solution for allocating a limited resource -- a congestion and pollution free roadway.
This idea is still being kicked around by the Congressional Budget Office who issued a report that supporting the idea of taxing drivers based on miles driven. The CBO suggested that a vehicle miles traveled (VMT) tax could be tracked by installing electronic equipment on each car to determine how many miles were driven; payment could take place electronically at filling stations.
If this proposed bill was passed it would create, within the Federal Highway Administration, a Surface Transportation Revenue Alternatives Office. It would be tasked with creating a "study framework that defines the functionality of a mileage-based user fee system and other systems."
This bill raises a lot of questions for me. Would this method for collecting road taxes increase driving or reduce driving? Would it result in the congestion and pollution free highways envisioned by Mary Peters the former Federal Highway Administrator? Today the highway taxes are relatively hidden in the total price of fuel, how would you respond when every receipt showed you how much tax was taken at each fill up? Would you be motivated to drive less? Would you be comfortable with the government knowing everywhere you drove between fill ups?