Over the past few years, the U.S. Highway Trust Fund, which finances road and transportation projects mainly through an 18.4 cents/gallon tax on gasoline and 24.4 cents/gallon on diesel fuel, has been unable to raise enough money to fund spending. 1 With the increasing number of fuel efficiency vehicles on the road today, which is expected to reduce the Highway Trust Fund by 21% by the year 2040 according to the Congressional Budget Office, the government is looking towards new means to increase funding. One of these is increasing the fuel tax, which hasn’t occurred since 1993, to account for inflation, while another is to replace the fuel tax all together with a new tax based on vehicle miles.
Bill Shuster, the new chairman of the House Transportation and Infrastructure Committee, called the vehicle miles tax (VMT) “fair,” and with the introduction of HR 6662 by U.S. Rep. Earl Blumenauer earlier this month, which “calls for a pilot program to study a mileage-based user fee in each state,” the potential for such a tax in the future is not far off. 2 States such as New York, Minnesota, Iowa, Nevada, and Texas already have vehicle mileage pilot projects in place while Oregon “is beginning the second phase of its project, which will expand the pool of users and test collection methods to address questions raised in the initial phase.” 3
Although the thought of a VMT was blocked in the past, including from Schuster’s own committee, the House of Representatives is considering Blumenauer’s pilot program.
But there is a long way to go and many concerns to evaluate before such a tax takes affect.
Looking into the Federal Highway Administration’s 2010 statistics, which cite the number of miles driven that year to be 2.97 trillion, there would need to be a vehicle miles tax of around 1.8 cents/mile to account for the $54.5 billion raised for the Highway Trust Fund. 1
Despite cost, truckers are stating privacy concerns over the idea, since the tax “would be levied, most likely through GPS or some other mileage tracking system,” not to mention the other issue of “implementing a nationwide network of tracking locations where motorists would see and pay their individual tax bills.” 2
Additionally, this tax would add to the perfect storm for capacity, brought about 
by factors including health care costs, credit markets, generation-x drivers retiring, CSA 2010, hours-of-service, fuel and equipment costs, and 2008 and the lingering recession. For more information about this perfect storm and its contributing factors, contact us via our online form at http://www.roadscholar.com/contact.php and mention the Perfect Storm for Capacity.
However, the primary concern right now is the Highway Trust Fund’s unstableness. As OOIDA Director of Legislative Affairs Ryan Bowley explains, “We’ve got a $105 billion shortfall over the next 10 years. Realistically, are we going to switch to a VMT for all vehicles in the next 10 years? I would say that would likely be too short of a timeframe, because it really goes back to that issue of scale.” 2
What do you think of the idea of replacing the fuel tax with a vehicle miles tax? What implications can you foresee this as having on your business?
Below is a list of U.S. Gas Taxes by state provided by http://www.gaspricewatch.com/web_gas_taxes.php.
Click to view
2http://www.landlinemag.com/Story.aspx?StoryID=24555
3http://www.ccjdigital.com/congress-eyes-vehicle-miles-traveled-tax/
