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Congress to Impose Tax on Vehicle Miles Traveled to Pay for Road Repairs

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Congress to Impose Tax on Vehicle Miles Traveled to Pay for Road Repairs

The US Government’s auditor advised the Congress to come up with a pilot program to test raising the necessary money for road repairs, through a tax on vehicle miles traveled.

As gas tax revenue isn’t enough to keep up with the nation’s road repairs, the Obama administration and Congress have been struggling to find new revenue solutions for this problem. In the following 10 years the government will have to deal with a $110 billion shortfall for road repairs if new revenue is not found. This number will most likely increase due to fuel use reduction and the government’s fuel efficiency mandates.

“Without a federal pilot program to evaluate options to more accurately charge commercial trucks and electric vehicles for their road use and the costs and benefits of such systems, Congress lacks critical information to assess whether mileage fees for these vehicles could be a viable and cost-effective tool to help address the nation’s surface transportation funding challenges,” said the Government Accountability Office.

Using the commercial truck user free systems, New Zealand and Germany have raised significant taxes and reduced emissions and road damage with fewer privacy concerns. As Americans buy more fuel-efficient cars, the federal Highway Trust Fund will run out of money. To cover shortfalls in the trust fund between 2008 and 2010, the Congress has spent $34 billion and $18.8 billion has already been approved for 2013 and 2014.

According to the GAO the Congress has two possibilities to solve this issue. One is to increase gas taxes to 46.6 cents a gallon from 31.6 cents, and the other is to impose a tax on all travel of 2.2 cent per mile. A mileage tax would mean that an owner of a passenger vehicle with average fuel efficiency would pay $108 to $248 annually in mileage fees, from $96 currently paid in US gas tax.

by Ana Cezara Savin (my Google+) - Thursday, January 10th, 2013 - filed under News, Other. Image credit: .
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