they're going to get punished for doing so." "We've tried for years to incentivize people to drive fuel-efficient cars," he said. This week, Fitz-Gerald took aim at the preliminary Obama administration bill's VMT tax. And stay tuned: It's coming to your neighborhood soon." Punishment for Driving Fuel-Efficient Cars? Speaking of state transportation officials there, Fitz-Gerald said at the time on FOX Business' "Varney & Co.": "I think they want their pound of flesh no matter which way they're going to get it to compensate for decades' of bad fiscal policy. Monday Morning Chief Investment Strategist Keith Fitz-Gerald, who drives a fuel-efficient turbo diesel and a Prius, predicted in January the idea of taxes targeting fuel-efficient cars would spread beyond his home state of Oregon. Virginia just imposed a $64-a-year fee on hybrid and electric car owners, while Washington State added a $100 registration fee for electric cars in February. Oregon is considering a pay-per-mile tax, while Texas, Massachusetts, New Jersey and Arizona are also weighing specific taxes or fees for "green" cars. The federal Highway Trust Fund, which pays for road and bridge construction and repair, is expected to run out of money by 2015, Michael Green, a spokesman for AAA, told Money Morning.Īs the feds consider the VMT, a handful of states could implement similar revenue-raising fees. The new VMT tax would bring in more revenue for road and bridge infrastructure. I'm the tax man." The VMT Tax: Taxing the Street I think George Harrison said it in the Beatles' "Tax Man": "If you drive a car, I'll tax the street. That means those who drive fuel-efficient cars - some of which, like the Chevy Volt and the Toyota Prius, were subsidized by the government - would pay the same vehicle-related taxes as other drivers. The VMT tax could replace the 18.4 cent federal gasoline tax, which hasn't been raised since 1993. Yes, you read that right: A new tax on every mile you drive. That's why the Obama administration is floating the idea of taxing you per miles driven, or as preliminary legislation puts it, "vehicles miles traveled" (VMT). So much for the gas tax savings among drivers of hybrids, electric cars or other fuel-efficient vehicles.Īfter years of cost savings for fuel-efficient car buyers, the government wants the gasoline-tax revenue that was lost at the pump because the fuel-efficient cars don't have to fill up as much as other vehicles. Save my name, email, and website in this browser for the next time I comment. Sign me up for the Money Morning newsletter Your email address will not be published. Or to contact Money Morning Customer Service, click here. Comment on This Story Click here to cancel reply.
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