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Coming soon? An EV-charging tax
States start to scramble as drop in gasoline taxes looms
(A native of England, Matthew Diebel is a veteran journalist who has worked at NBC News, Time, USA Today and News Corp., among other organizations. Having spent his childhood next to one of the world's fastest bodies of water, he is particularly interested in tidal energy.)
How much do you pay per gallon when you pull up to the gas pump?
Much of it has to do with taxes. If you’re lucky enough to be an Alaska, you’ll only fork over about 15 cents in addition to the 18.4 cents levied by the feds. In California, meanwhile, the state’s haul is almost 67 cents a gallon (plus a 2.25% sales tax), leading to some of the most expensive fill-ups in the nation.
EV drivers, meanwhile, don’t have to worry about the loathsome levies.
Which is why states across the country — and the feds — are watching the growing market for electric vehicles with considerable anxiety. Put simply: less gas being sold means lower revenues, with excise taxes on petroleum producing about $48 billion a year for states and $40 billion for the federal government. An extreme example is Wyoming, which has no state income tax and depends on fossil fuels (some them other than for gasoline) for 59% of its state and local tax revenues.
With a large chunk of their income set to disappear, some states are already addressing the shortfall, with Ohio, for instance, increasing the registration fee for electric vehicles to $200 a year, which is about three times the rate for gasoline-powered autos, something the Citizens Utility Board of Ohio and others have criticized as being a deterrent to EV adoption.
This battering of the bottom line is the subject of a study by Resources for the Future, a D.C.-based non-profit that does research into environmental, energy, and natural resource issues.
For instance, according Daniel Raimi, a lecturer at the University of Michigan and one of the study’s authors, a vehicle-miles-traveled tax can be a more equitable way to collect needed infrastructure revenue. It’s “a major challenge that needs to be addressed,” he said.
It appears that Mr. Raimi is given to understatement.