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Washington SB 5444 - to impose a mileage tax on owners of electric and hybrid vehicles

SB 5444, to impose a mileage tax on owners of electric and hybrid vehicles

https://www.washingtonpolicy.org/li...on-owners-of-electric-and-hybrid-vehicles.pdf

Text of SB 5444 SB 5444 would require the WSTC and state Department of Licensing (DOL) to create a plan for implementing a per-mile charge on electric and hybrid vehicles by December 1, 2022. The plan would include mileage reporting options, recommended rates and collection methods, options for working with other states or countries in developing and administering the RUC, options for payment plans as well as offsets and rebates, a governance structure and transition plan with the Department of Licensing (DOL) as the lead agency that would operate and administer the RUC, and recommendations relating to privacy protection.

The bill directs that by July 1, 2026, electric and hybrid vehicles would pay a RUC of two cents per mile. In June of 2029, that rate would increase to two and one-half cents per mile. This would replace the $150 electric vehicle fee and the $75 transportation electrification fee that EV owners pay now when they renew vehicle registrations., as those fees would be repealed that same year. Drivers who wish to pay a RUC sooner could do so through an early adoption program that would begin in 2025, and could have their EV fees waived.

Money collected from a RUC would be deposited into the Motor Vehicle Fund and used for preservation and maintenance.

Key Facts​

1. Senate Bill 5444 would require the Washington State Transportation Commission (WSTC) and state Department of Licensing (DOL) to create a plan for implementing a Road Usage Charge (RUC) on electric and hybrid vehicles by December 1, 2022.

2. The legislation is premature given the artificial cost-drivers officials impose on transportation projects. These should be eliminated before imposing a new tax on the public.

3. Owners of electric vehicles pay $150 each year as a gas tax offset. If lawmakers feel that is too low, they should consider raising it, rather than imposing a new and administratively costly tax to replace it.

4. Privacy protection is a critical element of the RUC, so any potential data vulnerability should be corrected before imposing a RUC system.

5. Rather than rushing implementation of a RUC despite unresolved privacy concerns, a better approach would be to first allow the Commission to complete its federally-funded research over the next few years and report concrete findings back to the legislature.

6. Any per-mile charge should be protected under the state constitution’s 18th Amendment, which protects money for highway purposes only.

7. To increase public trust, lawmakers should reduce artificial cost-drivers in transportation, and take preliminary steps to ensure any per-mile charge directly benefits and protects the drivers who pay it.
 
It seems like something that could be applied to all vehicles. Reassess the gas tax - some tax should remain to deal with the environmental impact of creating, transporting, and burning fuel. If they are going to start a Road Usage Charge, it should probably be calculated using miles driven and weight of vehicle and apply to all vehicles. A huge truck is doing more damage than my car when it uses a road (especially if there are chains or studded tires in use).
 

DerbyDave

Active Member
Jul 2, 2020
2,311
1,360
Kentucky
In KY, there is a bill to impose the $150 per year fee on EVs. DSolie, it really doesn't matter if you drive in state or out of state, they are trying to recover lost gas taxes that EVs don't pay. Anyway you calculate it, there is a certain cost to recover -- low miles, high miles, in state, or out of state. I am not looking forward to this tax if it passes in my state, but it seems the easiest tax to administer and collect is the best. I guess the yearly fee applied at registration renewal is the most reasonable.
 

MP3Mike

Well-Known Member
Feb 1, 2016
18,059
44,496
Oregon
So, how about those who drive often out of State? Would we need to log/appeal out of state travel? This has been the biggest hurdle of a $/mi model. You shouldn't have to pay a road tax on miles that you are not on the State's roads.
The pilot system in Oregon uses a GPS device so it only counts miles driven in Oregon. (This is where the privacy concerns come in.) But I don't know if it counts miles not driven on public roads or not. (Probably doesn't really matter for most people.)

But it does make it so EVs from other states visiting don't pay the road use fee. So really there needs to be a national standard implemented.
 
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DerbyDave

Active Member
Jul 2, 2020
2,311
1,360
Kentucky
Wow, seems overly complex. Why don't they just put GPS devices in every car, and like a toll system, each state can collect the taxes on all cars in their state to get the total money they need, or let the Feds handle it and distribute taxes to the states. It really doesn't seem to matter, does it? Soon, they will tax solar houses to recover utility taxes lost to solar "savings".
 

drtimhill

Active Member
Apr 25, 2019
2,939
3,817
Seattle
Wow, seems overly complex. Why don't they just put GPS devices in every car, and like a toll system, each state can collect the taxes on all cars in their state to get the total money they need, or let the Feds handle it and distribute taxes to the states. It really doesn't seem to matter, does it? Soon, they will tax solar houses to recover utility taxes lost to solar "savings".

And what about the privacy concerns? What happens when (and it is when, not if) the GPS data is stolen? When will someone figure out that all they need to do is take the time difference between you being at two points on the freeway to issue you with a speeding ticket? Do you really want the federal or state government knowing where you are pretty much all the time every day?
 

DerbyDave

Active Member
Jul 2, 2020
2,311
1,360
Kentucky
And what about the privacy concerns? What happens when (and it is when, not if) the GPS data is stolen? When will someone figure out that all they need to do is take the time difference between you being at two points on the freeway to issue you with a speeding ticket? Do you really want the federal or state government knowing where you are pretty much all the time every day?
Like I said in my original reply, tax each EV $150 a year, or whatever the tax needed to be raised is. In fact, just extend the flat tax to all vehicles and remove the gas tax. No monitor needed, very little administration.
 
Like I said in my original reply, tax each EV $150 a year, or whatever the tax needed to be raised is. In fact, just extend the flat tax to all vehicles and remove the gas tax. No monitor needed, very little administration.

Flat tax, like we have now, is the best play IMO. I am not going to install a GPS in my vehicle just for the .gov to see where I am, where I have been etc.
 
The problem with a flat tax here is that someone whom drives very little (casual user) is taxed the same as a heavy user (maybe someone that drives all day every day for work, for example), while their actual degradation to the roads vary dramatically. This is obviously a gross oversimplification but the idea of a per-gallon tax at least has the appearance of fairness, in that the more you drive, the more gallons of gas you would purchase. Of course, this doesn't take into account variation in fuel efficiency between vehicles and driving styles etc., but at least it was somewhat proportional to your actual road usage, whereas a flat tax would not be.

The problem with EVs is that there isn't an easy analog of a per-gallon tax because typically your home charging is just bundled in with your utility bill along with all your other electricity usage. This is what leads to a GPS-based solution, to get back to the fair proportionality (charge the user by how much they actually use the roads), but does lead to the already mentioned privacy concerns.

You could alternatively look at self-reporting systems, or requiring inspections, but the former is open up to under-reporting, the latter is labor-intensive, and either could be more prone to error than a flat tax or gps-based approach.

Is there an alternative with none of these drawbacks?
 

DerbyDave

Active Member
Jul 2, 2020
2,311
1,360
Kentucky
I have no children, yet I pay thousands in taxes for public education and medical care for others who have children. I also pay hundreds a year in auto insurance taxes in a reverse tax, the more insured I am the more I pay. I pay the same as those who drive 100K miles a year and more. We need all roads to be maintained. I guess we could extend the monitoring so that I only pay taxes on the roads I use, and only according to the damage my vehicle does, but that stuff just doesn't work well. I generally drive under 10k miles a year, but with covid, it wil be much less, like 6K. Anyway, the government still needs to raise X amount of dollars. Bill me please!
 
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So, how about those who drive often out of State? Would we need to log/appeal out of state travel? This has been the biggest hurdle of a $/mi model. You shouldn't have to pay a road tax on miles that you are not on the State's roads.
Maybe the closest to fair is to have a federal program that gets split between states. I think it needs to be a program for all cars with a reassessment of any gas taxes to separate out taxes meant for road repair from other taxes (like environmental impact). The federal gas tax covers funds for highways, mass transit, and leaking underground tanks. ICE cars should continue to have the tax for funding leaking underground tanks. A per mile based on weight federal tax could be used for highway funding and mass transit funding. The state excise tax is where it gets tricky to roll into the mileage tax.
 
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Why don’t we charge tire tax instead of gas tax? All vehicle use tires, no matter what powers it. Also heavier trucks use lots of tires, so they would pay much more tax. Better than flat tax or GPS tracking.
Because that would incentive people to run on bald tires to avoid paying a $200/tire extra tax... and we have a global interest in people buying new tires in a timely way.
 

PLUS EV

Running on Empty
Sep 16, 2016
7,293
12,405
Seattle
Self reporting could potentially work. If people under report, they will have to make up the difference when they sell the vehicle. At that point mileage is always recorded for the title transfer. Most people would report actual annually to avoid the big bill down the road.
A lot of 15yo cars would be launched off a cliff :)
 
Because that would incentive people to run on bald tires to avoid paying a $200/tire extra tax... and we have a global interest in people buying new tires in a timely way.
Plus where do you collect that? The tire shop you buy the tire from? The tire shop that mounts the tires a customer bought somewhere else? The internet site that sold the tires unmounted? The internet site that sold you the wheel and tire kit? The dealers that sell you the tires or tires and wheels? Bob down the street that mounts tires on the weekend for $100 for his buddies and anyone that asks?

Yearly reporting with maybe a random audit letter sent out to 10% of the population or something to swing by a DMV in the next 30 days is probably the easiest (cheapest) way to collect and manage your tax, other than the current method of submitting a payment and getting a little sticker for your license plate.

Oh, and do you pay that tax on your winter tires and summer tires? Do you pay that tax on the all season tires you decide to replace on a brand new car with sticky summer tires even though the all seasons only have 500 miles? What about the track tires you buy for the autocross you run in a private parking lot five times a year with your local auto club group? The off road tires you buy for the big jeep you have but prefer not to run off season because they're really expensive and loud? The replacement tire you have to buy because you get a side wall flat 3 months after the first set of tires you bought?
 
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Plus where do you collect that? The tire shop you buy the tire from? The tire shop that mounts the tires a customer bought somewhere else? The internet site that sold the tires unmounted? The internet site that sold you the wheel and tire kit? The dealers that sell you the tires or tires and wheels? Bob down the street that mounts tires on the weekend for $100 for his buddies and anyone that asks?

Yearly reporting with maybe a random audit letter sent out to 10% of the population or something to swing by a DMV in the next 30 days is probably the easiest (cheapest) way to collect and manage your tax, other than the current method of submitting a payment and getting a little sticker for your license plate.

Oh, and do you pay that tax on your winter tires and summer tires? Do you pay that tax on the all season tires you decide to replace on a brand new car with sticky summer tires even though the all seasons only have 500 miles? What about the track tires you buy for the autocross you run in a private parking lot five times a year with your local auto club group? The off road tires you buy for the big jeep you have but prefer not to run off season because they're really expensive and loud? The replacement tire you have to buy because you get a side wall flat 3 months after the first set of tires you bought?
Well technically I would prefer to collect that when you dispose those tires. Because that’s when you prove “I have worn that much to the roads”. If those tires are disposed because they were nailed/stabbed/anything accidental, the charge would be reduced according to remaining tread depth. Obviously, the non street legal tires should be exempt from this.

The garbage collector or the shop dispose them for you could charge this money, just like when you disposing something harmful to the environment. It also gives people some kind of breath space as they can store the tires somewhere if they really need new tires but short on money to pay the disposal fee.

If you say someone can secretly throw his tires to the sea/river/wherever no one noticed, it will be just like throwing a bucket of toxic chemicals somewhere. We already have the legal system to chase and punish them.
 
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drtimhill

Active Member
Apr 25, 2019
2,939
3,817
Seattle
The problem to my mind with SB5444 is that some of the claims for justifying it are dubious, including "EV buyers are well-heeled and can easily afford this tax". Well, perhaps, but doesnt that apply to Mercedes and Lexus buyers also? And what happens when EVs get cheaper? Are they going to repeal that? Sure they will!! Just like we dont have to pay that civil war tax anymore. Oh wait, we do!!

I'm fine with an equitable tax system, and EV owners should of course pay for the services they use (roads) just like ICE drivers, but so far I'm not seeing any equity arguments so much as the usual "what else can we tax" arguments. WA state already has a $150 license fee for EV owners .. I have not heard that this will be dropped if they add a mileage tax for EV owners.

And what allowance is made for the environmental cost of ICE cars? Shouldn't they be paying extra for that?
 
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