In what could be a preview of the future, Washington has become the first U.S. state to impose an annual tax on EV drivers to make up for lost tax revenue. This is because electric vehicles don’t need gas, which is taxed to to provide for road repairs and infrastructure improvements. This move has some environmentalists up in arms, but it might not matter in the long run anyways.
First off, the fee imposed is small; just $100 a year. Gas taxes vary from state to state; Washington has one of the highest gas taxes at 37.5-cents per gallon. Add on to that another 18.4-cents per gallon for the Feds, and you get 54.9-cents per gallon in taxes that EV owners don’t have to pay.
While the number of EV owners right now is negligible, more fuel-efficient cars are becoming the norm even as the Federal gas tax hasn’t been raised in almost 20 years. The $100 tax in Washington will raise about $1.9 million, and EV owners are still only paying about half what the average resident pays in taxes.
Some environmentalists are upset that EV owners are being taxed, but the system for taxing cars based on gasoline consumption is nearing the end of its usefulness anyways. Cars have never been as efficient as they are now, and the increasing use of electrification means that some drivers could go months without putting any gas in their cars.
Most likely all future cars will move to a tax-per-mile-traveled system, an idea that is already being floated in places like the Netherlands. And while I may be for tax credits and/or rebates for EV buyers, I also think they should still have to pay their fair share in taxes. This is money that goes to Washington state for the repair of state roads that EV owners are using, same as everybody else. With so many state budgets falling short, EV owners should not be given a free pass.