December 31, 2008

Pay As You Drive

Once again, Oregon leads the way:

Oregon governor Ted Kulongoski plans to recommend his state transition away from the gas tax in 2009, eventually replacing it with a mileage tax.

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  1. I don’t see any difference. It seems to me that a gas tax is a mileage tax. The more mileage you drive, the more gas you buy, the more tax you pay. Is this just some overly complicated bloated government bureaucracy initiative that achieves the same thing, or am I missing something?

  2. It seems more to the point than the gas tax, because it directly and clearly encourages people to live close to where they work, shop, etc. A straight gas tax is a bit more abstract because it tends to make people think “I need to buy a more fuel-efficient car” rather than just “I need to drive less.” But I also see a lot of problems with implementing a system like this. Just read some of the responses on the website that story came from to see how the public will react.

  3. Pay as you drive is good for insurance, not for gas tax. Tax based on distance provides no incentive to drive that distance in a fuel efficient vehicle. Under this plan, if I drive across town in a Prius, and my neighbor takes the same trip in a Hummer, we pay the same tax, even though the Hummer as a heavier vehicle does more damage to the roads. A better approach would be to convert to a per-cent rather than a per-gallon gas tax, which would still encourage fuel efficiency while increasing revenue as fuel prices increase.

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