VMTax

Posted by on . 11 comments.

Ezra links to a story in which Ray LaHood says that the government is considering taxing VMT, as a means to fund transportation projects. From a strict policy perspective, it’s a pretty good idea (depending on the cost of deployment of the GPS systems). Folks who drive more are responsible for more wear and tear on the roads, but more importantly, they’re responsible for more of the negative social costs of driving — pollution, carbon emissions, congestion, and accidents. And where a gas tax may not reduce driving (it might simply lead to increased efficiency), a VMT tax absolutely will.

But I don’t know what I think about this, politically speaking. As Ezra notes, the immediate thing that comes to mind is the creepiness factor; the government will know where you’ve been driving. I don’t know if that’s enough to derail a VMT tax, but I know that the GOP will shamelessly hammer away at the theme, despite having officially become the part of civil liberties infringements.

The bigger issue, I think, is that the tax is anti-driving, obviously and on its face. This doesn’t bother me, but it will bother lots of other folks. A gas tax can be sold as a means to reduce pollutants and carbon emissions (or for the national security set, oil imports). But it’s not necessarily an attempt to reduce driving, and drivers can reduce its impact while still extreme commuting by buying a smaller car. A congestion toll is there to reduce congestion. Sure, it reduces driving, but the point, from a driver’s perspective, is that paying the toll generates a congestion free commute.

A VMT tax, by contrast, is payment for the very right to drive (and in America, this is perceived as a right). As such, I’m not sure it would fly. I could be wrong, of course. But my preferred method of financing transportation improvements remains an increase in the gas tax, combined with a broad and significant move toward congestion pricing.

Comments

  1. Alex B. says:
    February 20, 2009 at 10:54 am

    What I don’t get is why people keep pushing GPS based VMT taxes rather than raising the gas tax. I understand LaHood’s assertion that raising the gas tax in a recession is a bad idea, but this has some up before we were in a recession, too. The whole idea seems to be that the gas tax doesn’t raise enough revenue, thus we need a new tax to pay for stuff. The whole idea of just raising the gas tax is a complete non-starter for some reason.

    Considering that all of the infrastructure for raising the gas tax is already in place, and there aren’t any creepy big brother problems to deal with, how is that more of a political football than GPS VMT taxes?

  2. Chris S says:
    February 20, 2009 at 10:57 am

    I feel like it would be a lot more palatable to just take everyone’s odometer reading when they come in for their yearly car safety inspection or whatever. Sure you can’t tax different kinds of roads or times of day differently, but it basically eliminates the privacy concerns and should significantly lower the cost of implementation.

  3. rdg says:
    February 20, 2009 at 11:16 am

    Folks who drive more are responsible for more wear and tear on the roads, but more importantly, they’re responsible for more of the negative social costs of driving — pollution, carbon emissions, congestion, and accidents.

    this is wrong, except for the congestion aspects. wear and tear is a function of both distance *and* weight. a hummer or large delivery truck will cause much more wear on roads than a smaller vehicle over the same distance. i don’t know the ratios offhand but it is significant.

    secondly, when it comes to emissions, low emissions vehicles will emit far, far less than large vehicles.

    for example, a hummer h3 will burn 625 gallons of gas to travel 10,000 miles, while a civic hybrid can travel 25,000 miles using only 595 gallons (data from gpmcalculator.com).

    under lahood’s expensive to implement plan, the civic driver will pay 2.5x the tax, when it emits less.

    maybe you can start making tables and taxing each type of car differently, but it’s just FAR FAR simpler to raise the gas tax. politicians who resist this simply lack courage.

  4. Alex B. says:
    February 20, 2009 at 11:27 am

    Hummers do more damage to the roads, but even they aren’t even close to 18 wheelers and the like. They’ve always been under-taxed in the system, when compared to cars.

    What if this VMT GPS proposal only applied to commercial vehicles? They’re the biggest offenders when it comes to weight and VMT. Have everyone else just pay the (increased) gas tax.

  5. Doug says:
    February 20, 2009 at 11:31 am

    The Republicans built a pretty convincing case against government incursion. I like the gas tax, too, and I’m fine with congestion pricing.

  6. thm says:
    February 20, 2009 at 11:33 am

    Wear and tear on roads scales linearly with distance traveled but to the fourth power of axle weight. If you have a vehicle that’s twice as heavy as another, it will do sixteen times as much damage to the roads. (This, incidentally, is one of the often overlooked problems with looking to enhanced bus service–buses have the heaviest axle weight of any vehicles on the road, and often operate under weight limit waivers.)

    But I really don’t see the value of using VMT instead of gasoline consumption. Doesn’t carbon emission scale better with gasoline used than with distance driven? Or is this designed as a way to get around Jevons’s Paradox and induced traffic, by trying to make sure you just don’t do more driving once you buy a Prius?

  7. BruceMcF says:
    February 20, 2009 at 12:20 pm

    The Federal Highway fund has been skating along on the fact that US motorists have been plowing improved engine efficiency into driving bigger vehicles … but if we get a repeated series of oil price shocks, which is likely, then we will see years with falling gasoline consumption, and then the fund will not have the amount that it hopes to have.

    And since the easy way to spend money for this or that is “take it out of the highway fund”, loss of highway fund dollars is a threat.

    Adding in the prospect for taxes or Carbon Feeds with incidence on gasoline that do not go into the fund, and the risk goes up further.

    Far better, of course, to make up for shortfalls with congestion taxes.

  8. Candlejack says:
    February 20, 2009 at 1:31 pm

    It’s a horrible, horrible idea.

    Taxing carbon and liquid fossil fuels is good policy partly because it transparently attacks the very things we’re trying to attack with a gas tax: climate change, national economic dependence on other countries, national economic dependence on a finite & peaking resource industry, and funding for an expensive, crumbling interstate highway project that wears down severely every time a gas guzzler drives over it. A single medium-duty commercial truck with an axle weight of 10 tons wears out the road as much as !160,000! subcompacts with 1000lb axle weights. I’m not suggesting that we make it pay that much, but scaling compensation with fuel is certainly more reasonable than with VMT.

    “Folks who drive more are responsible for more wear and tear on the roads, but more importantly, they’re responsible for more of the negative social costs of driving — pollution, carbon emissions, congestion, and accidents”

    Pollution is addressed by national emissions standards – where we can and have achieved hundred-fold decreases in certain types. Auto pollution is a largely solved policy problem (though enforcement, as always, has to be effective). A single coal plant puts out more crap than our entire annual fleet of new cars.

    Carbon emissions scale with amount of fuel used – simple as that. Garbage in, garbage out.

    Accidents scale with VMT and vehicle size – both influence fuel used.

    The only reasonable argument for VMT is to target a congestion zone by travel distance rather than demarcating a sharp border (as in tolls & congestion taxes). I would argue that anywhere this is applicable, a combination of simple *light* sticker-based tolls throughout the city (rather than at the border) and parking limitation is much cheaper and much more effective than this Orwellian stuff.

    Use a significant but not crippling ($10-$50) federal carbon tax to fund transportation & conservation (with the Interstate Highway System as a small section). Add a punitively high revenue-neutral gas tax in order to wean us off of the international oil industry in a decade. Divy that up and write checks to every American taxpayer. Sell them both as protectionism for the American Way Of Life – which they are, in the truest sense of the word. Pitch it on Lou Dobbs, pointing out that you’ll only be sending checks to adult American citizens – and this is a huge disincentive to illegal immigration, while hitting the oil company bottom line and greatly assisting the middle class, who can’t afford to overuse oil in the first place.

    It’s not political suicide if you do it right. And if you manage it, you’ve solved the root cause of about half of our national problems.

  9. Norman Brown says:
    February 20, 2009 at 5:11 pm

    I personally think that a better way to capture the marginal cost of driving is through insurance rates attached to VMT. This can be coupled with a black box nanny that drivers would agree to attach to their vehicles that could deliver insurance rate preferences as well. As it is the unlimited mileage associated with the basic insurance policy encourages people to decrease their per mile cost of insurance by driving lots of miles.

  10. Omri says:
    February 20, 2009 at 8:36 pm

    The whole point is moot. Worsening road conditions will cause this problem to solve itself over the next few years.

  11. Mixner says:
    February 20, 2009 at 9:15 pm

    Ryan writes,

    Folks who drive more are responsible for more wear and tear on the roads, but more importantly, they’re responsible for more of the negative social costs of driving — pollution, carbon emissions, congestion, and accidents.

    Gas consumption is a far more reliable measure of pollution, carbon emissions and road wear-and-tear than is VMT, because there is so much variation between different types of vehicle. Neither VMT nor gas consumption is a meaningful measure of a vehicle’s contribution to congestion. The only item on your list for which VMT may be a better measure is accidents, and even there the difference is probably small.

    And where a gas tax may not reduce driving (it might simply lead to increased efficiency), a VMT tax absolutely will.

    So what? Why should the goal be to reduce driving rather than to make driving more efficient and sustainable?