Vehicle Miles Traveled (VMT) Tax Proposal

The state of Kansas is considering adopting a pay by mile Road Usace Charge to potentially replace the states per gallon gasoline tax. State officials cite that the increase in fuel economy and expansion of use of electric vehicles could potentially reduce the tax revenues needed to pay for needed maintenance upgrade and expansion of the states road network. Currently the state is doing a VMT tax study to determine the viability and benefits of replacing the per gallon tax with what would essentially make any movement of your vehicle tollable. Potentially even on your private roads or miles travelled while outside the state of Kansas.

Concerns

There are several concerns being weighed in regards to the states considering such a taxation model. Would it hurt poor and disadvantaged road users more than others? Would users be exempt from paying a Road Usage Charge on private roads or while traveling outside of Kansas? Will there be privacy concerns about the use of GPS vehicle tracking and monitoring? Would law enforcement or other private entities be able to use this data for tracking, enforcement or marketing purposes? Will we have to file an additiona tax return to the state to declare our miles driven and pay the tax? Certainly there are a lot of things to consider about possible loss of privacy.

Potential Cost

Initially the proposal on the website talks about a $.01 per mile tax on every mile driven in the state. For instance, someone who drives 1,000 miles in a year would end up paying a $10 tax for the usage of the road network, Average road use annually is roughly 13,000 miles, meaning that the average user could expect a tax bill of $130. And if you drive more they you would pay more. As you can see it adds up.

Fairness

For fairness sake, miles driven outside of Kansas should not be able to be calculated into the tax especially since other states still have a per gallon tax. Also how would the state be able to charge road users that live in another state that happen to be traveling through the state. Many people commute in cities located near the states borders and may drive through or into Kansas to reach their destinations and workplaces. Should the state also be able to receive revenue from these users? And, would it be fair to charge these users if they have already paid a tax in their own state for gasoline or electric charging fees.

Conclusion

It seems like there are a lot of things that have to be considered before implementing such a taxation plan. On the surface it seems fair, if all 50 states are doing it, but if not it could lead to potential double taxation situations, or missed revenue from travelers using our roads and not paying into the system. The only way to make it fair is to use GPS tracking to make sure that Kansas drivers are not paying mileage fees when driving outside of Kansas. Additionally, if there was a way for Kansas drivers to be able to be exempt from paying per gallon state taxes in other states, but that likely would not happen either. Perhaps using other means to generate revenue could work. such as having a hybrid/electric vehicle user fee that users pay at registration times. Additional tolling options could be employed on other major corridors, however you have to consider the impacts of tolling on those living under the poverty standard.

It does seem fair for electric users to pay their fair share toward the road network, Electric users may be drawn to electric vehicles for the potential energy savings due to the high cost of petroleum, which has largely been driven by public policy in government (federal, California, etc.) and also to avoid federal and state gasoline taxes. Any way you slice it, someone is going to be impacted negatively. Hopefully, the state can come up with an option that works for everyone.