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Who says you should tax directly based on wear anyway? The bigger scarcity is often traffic in any case. Some roads have higher costs than others. etc. Maybe w
by dalbasal 6y ago
Who says you should tax directly based on wear anyway? The bigger scarcity is often traffic in any case. Some roads have higher costs than others. etc.
Maybe we want to lower transport costs by charging trucks less. Maybe we want to encourage electric car viability by charging them less. I mean, tax policies have outcomes. Doesn't it make sense to target outcomes we want?
Obviously the road needs to be paid for and fuel taxes won't work if people don't buy fuel. That said, I think it's inevitable that whatever comes next is a policy... encourage some stuff, discourage other stuff, benefit certain people/sectors and such. ATM, encouraging electric vehicle adoption with a fuel tax exemption doesn't seem crazy.
It does create a regressive dynamic, where new electrics are subsidized by legacy ICE. By the time that represents more than a rounding error the fuel tax deficit will be big enough that the tax system will be changing anyway.
A better approach is probably a time-of-purchase tax. =