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Eh, 17 states already charge EVs and those numbers are going to go up. Just a back of the envelope estimate: With Federal gas taxes of 20 cents per gallon and

by rsj_hn 5y ago

Eh, 17 states already charge EVs and those numbers are going to go up. Just a back of the envelope estimate: With Federal gas taxes of 20 cents per gallon and state levies ranging from 20-60 cents, let's say an average of 40 cents for a total of 60 cents a gallon. ~120 Billion gallons of gas are used each year, say 200 million adult drivers means each adult is paying around .6*120B/.2B = $360 per year in gas taxes. $400 seems to be a reasonable ballpark for the gas tax revenue lost per year. That's not a revenue stream governments are going to be willing to lose, so as EV popularity increases, you can expect more of this. It doesn't seem too awful, TBH. The alternative would be to have a special levy on electricity, similar to what we do with gasoline, but that's going to hit a lot more than PEV drivers, so if we fund roads with use fees, which we currently do, then paying a few hundred bucks a year in lieu of gas taxes seems fair.

ayberk 5y ago
WA has similar fees for electric vehicles and the main problem is the fact that it's a flat fee. With gas taxes you inherently pay more if you drive more, whereas EV owners pay the same regardless of how much they drive. Moreover, it's a $225 fee which is what a 30mpg gas car would pay for driving ~15k miles or so. This TX bill seems to have a flat fee + another fee based on mileage, which sounds more reasonable.
InvaderFizz 5y ago
Texas is already short on their highway funds. Only 41% are funded by use fees[0]. Back of the napkin for me says it should be about $0.40/gal given the Texas gas tax is $0.20. Either way, I suspect that even this is too low and Texas is due for an increase in the gas tax by another $0.10-$0.20 in the next few years. This $400 fee will most likely be the EV taxes moving first, in my estimation. 0: https://comptroller.texas.gov/economy/fiscal-notes/2019/jul/motor-fuels-taxes.php https://comptroller.texas.gov/economy/fiscal-notes/2019/jul/...
jhayward 5y ago
Texas gas taxes are $0.20 state tax, plus $0.184 Federal tax for $0.384 per gallon total. $400 / $0.384 = 1042 gallons of gasoline in equivalent taxes. Typical annual mileage per vehicle runs around 12,000 miles. Most cars get much better than the 11.51 mpg implied by the tax. So Texas EV users are being financially punished for cleaning up the air. Which is very, very much on-brand for Texas. I'm amazed they aren't outlawed.
newacct583 5y ago
With the exception of a couple of toll roads here and there and no doubt some complexity in some state's legilation, we absolutely do not fund roads with use fees. These are all general fund taxes, not earmarked in any meaningful way. And in any case the revenue they generate doesn't come even remotely close to the cost of maintaining the ground transportation network. This point just doesn't hold, sorry. I mean, fine. Maybe the gas tax is unfair and we should replace it with something more neutral. Or maybe the gas tax should be viewed as a "sin tax" the way taxes on alcohol and cigarettes and tanning are. Maybe it should be higher, if that's the case. But whatever side you decide to come down on, wanting a steady source of revenue for road maintenance just isn't related. In this case, the Texas legislature clearly wants to stick it to the dirty fucking hippies. Their roads are fine and they know it. (That said, if Texas were to institute a new tax on electrical generation to better regulate its disastrous distribution network, maybe there would be an argument...)
- Gibbon1 5y ago
  > In this case, the Texas legislature clearly wants to stick it to the dirty fucking hippies. Their roads are fine and they know it. I agree it's motivated by a sort of hyper conservatism; all change is bad and needs to be resisted. Meanwhile California has down payment and buy back programs for low income people to replace their cars with hybrids and ev's.
stefan_ 5y ago
The problem is that road damage is not primarily caused by cars, but heavy trucks who do not pay for it proportionally. This represents a massive subsidy that has caused rail transport to decline and shift instead to trucks which not only trash roads but kill and maim tons of people while doing so. That's clearly a less than great outcome that could be remedied through taxation and regulation, but not if you start at taxing EVs.
- rsj_hn 5y ago
  Trucks pay higher tax rates for diesel, but I don't think the point of use fees must be to charge people for how much damage they do to the roads but how much benefit they obtain from the roads. This is very tricky because roads have so many positive externalities. Even if you live in a walkable neighborhood and don't own a car, you will walk to stores that have goods delivered to them by truck, right to your neighborhood, so you can walk up and buy them. Without all those trucks bringing things close to where you live, you wouldn't have that convenience and would need to get a car yourself. Probably a heavy car since you'd have to haul everything yourself -- everyone would need to drive right up to the factory gate and then transport it back for every good you buy. Imagine what that would do to the road quality! So trucks help use the road more efficiently and actually save the road relative the alternative of not having dedicated trucking. And not only that, but that fact means local stores are in competition with stores farther away, which drives down prices. So even people who never drive obtain many valuable benefits from the roads that connect their neighborhood to other neighborhoods, and many of these benefits are delivered, so to speak, by trucks. Thus everyone pays for these benefits. This idea that once there is a road connecting two markets, that prices begin to equalize in them was one of the things observed by Adam Smith when he talked about how local shopkeepers often opposed roads connecting their town to towns with larger markets (and cheaper goods). Now they don't equalize perfectly, they equalize up to transportation costs. Thus lowering transportation costs for the trucks that ship goods between markets results in lower prices for everyone who buys those goods, even if they don't use the road themselves. This is why it makes sense to subsidize the transportation of goods. Thus our current system makes sense, roads are paid in part from general funds, in part from use fees, and there are some extra fees added to trucks.

by rsj_hn 5y ago

ayberk 5y ago

WA has similar fees for electric vehicles and the main problem is the fact that it's a flat fee. With gas taxes you inherently pay more if you drive more, whereas EV owners pay the same regardless of how much they drive. Moreover, it's a $225 fee which is what a 30mpg gas car would pay for driving ~15k miles or so. This TX bill seems to have a flat fee + another fee based on mileage, which sounds more reasonable.

InvaderFizz 5y ago

Texas is already short on their highway funds. Only 41% are funded by use fees[0]. Back of the napkin for me says it should be about $0.40/gal given the Texas gas tax is $0.20. Either way, I suspect that even this is too low and Texas is due for an increase in the gas tax by another $0.10-$0.20 in the next few years. This $400 fee will most likely be the EV taxes moving first, in my estimation. 0: https://comptroller.texas.gov/economy/fiscal-notes/2019/jul/motor-fuels-taxes.php https://comptroller.texas.gov/economy/fiscal-notes/2019/jul/...

jhayward 5y ago

Texas gas taxes are $0.20 state tax, plus $0.184 Federal tax for $0.384 per gallon total. $400 / $0.384 = 1042 gallons of gasoline in equivalent taxes. Typical annual mileage per vehicle runs around 12,000 miles. Most cars get much better than the 11.51 mpg implied by the tax. So Texas EV users are being financially punished for cleaning up the air. Which is very, very much on-brand for Texas. I'm amazed they aren't outlawed.

newacct583 5y ago

With the exception of a couple of toll roads here and there and no doubt some complexity in some state's legilation, we absolutely do not fund roads with use fees. These are all general fund taxes, not earmarked in any meaningful way. And in any case the revenue they generate doesn't come even remotely close to the cost of maintaining the ground transportation network. This point just doesn't hold, sorry. I mean, fine. Maybe the gas tax is unfair and we should replace it with something more neutral. Or maybe the gas tax should be viewed as a "sin tax" the way taxes on alcohol and cigarettes and tanning are. Maybe it should be higher, if that's the case. But whatever side you decide to come down on, wanting a steady source of revenue for road maintenance just isn't related. In this case, the Texas legislature clearly wants to stick it to the dirty fucking hippies. Their roads are fine and they know it. (That said, if Texas were to institute a new tax on electrical generation to better regulate its disastrous distribution network, maybe there would be an argument...)

Gibbon1 5y ago
> In this case, the Texas legislature clearly wants to stick it to the dirty fucking hippies. Their roads are fine and they know it. I agree it's motivated by a sort of hyper conservatism; all change is bad and needs to be resisted. Meanwhile California has down payment and buy back programs for low income people to replace their cars with hybrids and ev's.

stefan_ 5y ago

The problem is that road damage is not primarily caused by cars, but heavy trucks who do not pay for it proportionally. This represents a massive subsidy that has caused rail transport to decline and shift instead to trucks which not only trash roads but kill and maim tons of people while doing so. That's clearly a less than great outcome that could be remedied through taxation and regulation, but not if you start at taxing EVs.

rsj_hn 5y ago
Trucks pay higher tax rates for diesel, but I don't think the point of use fees must be to charge people for how much damage they do to the roads but how much benefit they obtain from the roads. This is very tricky because roads have so many positive externalities. Even if you live in a walkable neighborhood and don't own a car, you will walk to stores that have goods delivered to them by truck, right to your neighborhood, so you can walk up and buy them. Without all those trucks bringing things close to where you live, you wouldn't have that convenience and would need to get a car yourself. Probably a heavy car since you'd have to haul everything yourself -- everyone would need to drive right up to the factory gate and then transport it back for every good you buy. Imagine what that would do to the road quality! So trucks help use the road more efficiently and actually save the road relative the alternative of not having dedicated trucking. And not only that, but that fact means local stores are in competition with stores farther away, which drives down prices. So even people who never drive obtain many valuable benefits from the roads that connect their neighborhood to other neighborhoods, and many of these benefits are delivered, so to speak, by trucks. Thus everyone pays for these benefits. This idea that once there is a road connecting two markets, that prices begin to equalize in them was one of the things observed by Adam Smith when he talked about how local shopkeepers often opposed roads connecting their town to towns with larger markets (and cheaper goods). Now they don't equalize perfectly, they equalize up to transportation costs. Thus lowering transportation costs for the trucks that ship goods between markets results in lower prices for everyone who buys those goods, even if they don't use the road themselves. This is why it makes sense to subsidize the transportation of goods. Thus our current system makes sense, roads are paid in part from general funds, in part from use fees, and there are some extra fees added to trucks.