Vermont Not Alone In Grappling With Gas Tax Changes

Apr 3, 2013

By Steve ZindThere was a lot of response to Tuesday’s Vermont Edition program on changing the gas tax.  The idea is in play in the legislature because of a shortfall in the transportation fund which pays for highway and bridge repairs.This Council On Foreign Relations “Renewing America” blog post gives a brief, broad overview of the nation’s deteriorating road conditions and the inability of gas taxes to pay for needed repairs.It appears that Vermont may abandon the tradition of imposing a tax that is a set amount per gallon and follow the precedent set by Virginia which has imposed the tax as a percentage of the price per gallon.Another idea is the Vehicle Miles Traveled (VMT) tax.As this 2012 report from the Vermont Energy Investment Corporation says the advantages of the VMT tax include:

  • Fair allocation of the cost of maintaining roads and bridges.
  • Encouraging drivers to reduce travel.
  • Cuttting energy use.

The report suggests a rate of 13 cents a mile.“This option is a long term solution that would require significant policy changes before implementation,” the report concludes.Tracking vehicle mileage could be accomplished using the on-board GPS units in cars that have them (which raises privacy issues) or taking annual odometer readings.Whether or not they choose to go the VMT route, many believe that states will have to come to grips with the impact of fuel efficient vehicles on revenues raised through the gas tax.  A so-called ‘Prius Tax’ that would levy a higher registration feel on fuel efficient vehicles has been discussed in Montpelier.