New Gov't Tax on EV's. Hybrids?

Ok, so we know that gas at the pumps has a tax on it to pay for the freeways being used by the vehicles buying the gas. I read in the local Los Gatos Daily paper this weekend, that EV's use the freeways but don't pay the tax at the pump to help pay for the roads they use. So they are looking to tax EV buyers separately to help pay for this "free ride". I can't remember if this included Hybrid vehicles too.

What are your thoughts about this? :thinking:

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It is an outstanding idea. IMHO, a good way to tax them would be by the electric power they consume, instead of vehicle mileage, which folks have been known to tamper with. But then folks would charge at other places, since all it takes is a dryer plug in to charge most vehicles. Maybe a combination of the two would be good. Any other ideas?

As I understand it, the cells used right now in the cars, don't pay for their recycling costs. IMHO, it would be a great idea to also levy a tax at purchase, on the cells, and a person would get half at replacement, and the other half would be recovered at the actual recycler's door, paying for them to recycle the cells. Hopefully they will figure out a cheap way to recycle the cells that makes it economical.

And while we're at it if we want to be fair let's tax gas-powered autos on their true pollution costs ($5 to $10 per gallon depending upon who you believe).

As far as wear and tear on the roads, it's related to weight raised to the fourth power. Yep, an 8,000 pound Hummer causes as much wear as sixteen 4,000 pound sedans. And one 80,000 pound 18-wheeler is equivalent to 10,000 Hummers or 160,000 sedans. To be 100% fair you would need a tax proportional to mileage and weight to the fourth power. Trucks and buses would get stuck paying 99% of the tax, and SUVs most of the rest. EVs and smaller cars might be hit with a tax of a few tens of dollars a year, so tax away, so long as the tax structure is fair as I described, and we add a pollution surcharge to gasoline sales. This puts everything on a level playing field. As a bonus, with the heavy taxes trucks would pay on road use and fuel, we might actually see most long distance freight start to go by rail which in turn would make the roads safer.

It makes little to no sense.

There is a need for developing alternative fuels, and EV buyers are incented by various governments to take a chance on buying them or converting existing vehicles to BEV. There are pollution issues that are addressed by the Hybrids, so it's in society's best interest to promote that technology too. There are incentives available from various giverntment agencies for hybrid owners.

So why give a $1000 credit and then tax the same car extra?

In reality, the gasoline tax does not always go to roads. It goes to support local many, many projects that are trasnportation related, like anti-drunk driving campaigns, The Ferry service across the San Francisco Bay, buses, etc.

The gas tax does not fairly apportion the costs of the transportation infrastructure. A 3 ton SUV getting 20 MPG will do more damage (wear) to the roads than a 1.5 ton Camry getting 30 MPG. A 4x4 with studded tires will tear up the asphalt and not be charged extra. It's not equitable.

In Calif, we pay a yearly USE tax based on the value of the car. This 8.5% is also supposed to pay the transportation infrastructure. A brand new $50,000 sports coupe driven 1 day a month pays a lot more than the 10 year old SUV (worth $4,000) that drives across town every day.


If they want it equitable, make everyone pay by the mile and no tax on gas. Pro-rate it based on the weight of the vehicle. If commercial, pro-rate it based on maximum carrying capacity.

It's not like we really need to make up new ways to tax us.

I agree with Daniel and jtr. It should be based on the vehicle's weight. I have been riding the bus for years. It was noticed some time ago that the roads along bus lines wear out more quickly because of their weight. Locally, we have beefed up these roads along the bus routes.

We do need to pay for the roads some way, so... I don't mind paying road taxes. We just need a sensible way to do it. By weight seems fine to me...but then you need some way of figuring the miles. If I have a really heavy vehicle but only put on 10,000 miles a year I should pay less than if I have a really heavy vehicle but put on 50,000 miles a year.

I heard a proposal on the radio to use GPS devices to record all of your travel and then once a year to do a download with a summary by state of your miles (that you then pay into a fund and the fund pays it out to the various states where you've been).

ikendu said:

I heard a proposal on the radio to use GPS devices to record all of your travel and then once a year to do a download with a summary by state of your miles (that you then pay into a fund and the fund pays it out to the various states where you've been).

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I've read news articles on that proposal too. The part they left out of the equation is the cost to equip all vehicles with GPS devices. And who's going to end up having to pay for it? The consumer. That means the consumer has to pay for the GPS device on top of the mileage tax. Then there is the feeling that Big Brother will be able to track people even easier.

This is one of those sticky issues, certainly. Taxes are the end-all in many political circles, of course - and if some folks feel that they're losing out on any kind of tax, there will be hell to pay! And I believe that ALL vehicles should be taxed fairly for the public costs they incur. Taxing a 3000 pound EV (or hybridy or biofuel, or even standard gasoline car) at the same rate of an 8000 pound SUV would simply be absurd. But how do we do it fairly? Is doing it fairly worth the expense/loss of privacy that GPS locators would add?

I don't know. If doing it by weight/miles doesn't work, how about by unit of energy consumption? That roughly bundles in weight for you. Afterall, an 8000 pound EV will consume far more electricity than a 3000 pound EV. So it would be fuel independent - just tax per unit energy of fuel. But that might let EVs, hybrids and diesel guys off easy. Those guys should be penalized for being efficient!

Seems perfectly fair to me, there's no reason they should get to use the road tax free. Oregon is currently testing a system that would let you pay taxes by the mile driven, and probably based somewhat on weight. The current system of taxing gasoline is just plain stupid - there's no reason I should be paying twice the road tax just because my old truck gets 9mpg and a new truck that weighs the same gets over 18mpg. Do I get twice the use out of the roads, or cause twice as much damage? Of course not.

This does beg the bigger question:

Is "road use" the only thing we should be paying for when driving? Should the cost of clean water and clean air be lumped in with it? Human health? How about the military protection of our foreign oil supplies? The answer here is much different if we ONLY want to discuss taxes that go toward building and maintaining roads. If we want to discuss ALL social costs of driving a given vehicle, this gets complicated in an hurry.

We're talking here about hard costs (building and maintaining roads) that are incurred by the action of using those roads. Should we consider the road costs in a vacuum, or should we consider ALL costs of driving a given vehicle and base a single tax on that? I ride my bicycle on the expensive roads for thousands of miles every year. Should we be paying taxes for that use as well, or is it OK for automobile drivers to subsidize that use?

Taxes - Hard to say more should be applied, but reality is different.

First - I don't think we should be subsidizing the purchase of EVs and hybrids at all. The reason - At this time, this is just a subsidy for foreign cars. How can we reasonably be subsidizing Honda and Toyota while 50,000 Americans are getting the axe ? Yes, I know GM has its issues, but this a separate matter.

There is no way you can convince someone who has lost their job that their tax money should go to help buy a foreign car. Personally, I think the sales tax on low North American content cars should be triple the rate on High North American content models.

Second - Hybrids are fundamentally gas consumers, but at a slower rate. If someone figures out how to make a car go 1,000 miles on 1 gallon of gas, go for it. I really doubt that anyone will make a pure hybrid that weights 10,000 lbs that gets high mileage.

Third - Plug ins. If they are buying residential rate electricity in CA to commute to work, it is doubtful that they are saving all that much money. It would not take long to hit the $ 0.20 - 25 / kwh rate. At that price, I am not too worried about the small number of EVs on the road having a big dent on tax revenue for roads.

Solar powered - I hate subsidizing others, but if you can make that work, then I actually will subsidize your road tax until it gets to be > 2 % of the total vehicles. Anyone who does this now is probably just some crazy central valley CPF nut anyway (just kidding D)

Biofuel - Not a big issue here in CA. It is not all that easy to get ahold of a diesel car anyway here due to pollution standards, and the amount of biofuel available is going to be pretty limited. I am not sure about this, but it seems unlikely that even 2 % of the gas could be replaced by biofuel here.

Boy, this gets WAY complicated in a BIG hurry!!

Here's another monkey wrench:

Determine how the electricity is generated to charge the EV, then tax based on that as well. If it's clean, (windpower, {I know they are bird guillotines}, hydroelectric, solar) then it is lower cost than if fossil fuel based electric production.

I always laugh at the celebrities who make a big deal about their EV's but recharge their cars with coal, gas, or some other fossil fuel produced electricity.

Bill

Darell said:

I ride my bicycle on the expensive roads for thousands of miles every year. Should we be paying taxes for that use as well, or is it OK for automobile drivers to subsidize that use?

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The wear and tear a bike causes on roads is entirely negligible. A fair tax based on actual damage to roads would probably amount to pennies a year even for an avid rider. In short, it wouldn't be worthwhile to collect it. And if cyclists like myself were to pay much higher taxes similar to what other road users pay, you can be damned sure we would be demanding a lot more than three feet of space between the traffic lanes and the row of parked cars. Rather, I would ask for cycling routes paralleling main roads completely grade separated from traffic, and kept in good repair. I would be asking the city to pay to repair my bike whenever I hit a pothole since the tax is to keep roads in good repair. I would ask for a bike-mounted device which turns the traffic lights green before I get to an intersection since I feel a ZEV should always get priority over other traffic. In short, taxing bikes for road use opens a whole can of worms (even attempts to get owners to register them have always flopped), and I suspect taxing EVs will do the same. Perhaps we shouldn't subsidize their purchase, but we shouldn't levy special taxes on them either just because they don't pay a gas tax.

BTW, while current EV subsidies may in effect subsidize foreign automakers, is it really our fault or problem GM and others didn't step up to the plate when they had the chance? Instead of pushing to have California's ZEV requirement dropped they should have welcomed the opportunity to show what they were capable of. They didn't, so the rewards for making EVs will go foreign automakers. Also, GM is perpetually losing jobs because of the unions. Compared to similarly skilled workers in other industries auto workers just plain cost too much. My guess is long term (say 10 to 20 years) we won't have cars made at all in the US unless the unions get realistic at the bargaining table.

the fact that they are even working on this is a good thing, that means it's mainstream enough to bother taxing, which is GOOD!

I'm totally against the GPS thing. When asked how to charge people will always say "by usage" if they think they use something less than the average joe, and "standard fee" if they think they use something more Personally I think that weight x milage should be the ticket, but that just adds so much more paperwork and stuff that I"m sure that they will do it exactly the same as today which is you pay for your stupid sticker if the car sits the garage or if you drive 1000 miles a day.

James S said:

the fact that they are even working on this is a good thing, that means it's mainstream enough to bother taxing, which is GOOD!

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How can EVs be considered ANYTHING near mainstream when there are none available to buy? Being *scared* of them becoming mainstream I can see...

How can EVs be considered ANYTHING near mainstream when there are none available to buy?

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there is an amazing pent up demand. The politicians have finally realized that once they are available people will be not buying regular cars in droves

Now, if only the car makers would realize that we'd be all set. Funny to see major manufacturing companies making policy decisions slower than the government... Should tell you something about the management of the major car companies shouldn't it No need to invoke conspiracy when stupidity will explain everything that we see

HarryN said:

First - I don't think we should be subsidizing the purchase of EVs and hybrids at all. The reason - At this time, this is just a subsidy for foreign cars.

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This is a bitter pill for me to swallow. My first electric car was made by GM, right here in America. I loved that car, and GM wouldn't let me extend my lease nor buy it. I'd be THRILLED to buy a US-made EV or plug-in hybrid. Just show me where they are!

James S said:

there is an amazing pent up demand. The politicians have finally realized that once they are available people will be not buying regular cars in droves

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I agree, and I'll add that once they're available in droves I can easily see places like NYC prohibiting operation of ICE vehicles within the span of normal auto life cycle (say within 7 to 10 years). Here it would be an easy sell since half the voting adults don't even drive. I'm sure lots of other large cities would follow suit once they saw the benefits in NYC. So not only do we have pent up demand, but once that demand is met we'll in effect create captive markets where ZEVs are the only thing even allowed.

HarryN said:

First - I don't think we should be subsidizing the purchase of EVs and hybrids at all. The reason - At this time, this is just a subsidy for foreign cars. How can we reasonably be subsidizing Honda and Toyota while 50,000 Americans are getting the axe ? Yes, I know GM has its issues, but this a separate matter.

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I worked for GM for 17 years (as an engineer). I don't have much sympathy for them or their market choices. I worked in Industrial Engineering (the guys who optimize factory processes) at a division (Delco Products) that produced electric motors (I should say DID produce). I sketched out a design for a parallel hybrid drive train that was a Plug-in Hybrid Electric Vehicle (PHEV). This was in the mid-70's. Response from my management? "Keep your mind on factory optimization. We're not interested in alternative drive train ideas."

Also, GM actually did produce a very nice electric vehicle decades later (Darrel's EV1). As soon as the Board Chairman (Roger Smith) retired that had championed that product... the "scared to take a chance on the future" guys that followed pulled the plug on the EV1. Big mistake. I won't cut them any slack at this point. They have had ALL the chances they need to earn the loyalty of the U.S. car buyer. Now, they are just in the way. I would much rather have more Toyota factories here to meet U.S. demand for PHEVs than more GM factories pumping out high horsepower SUVs burning up our remaining fuel sources.

HarryN said:

There is no way you can convince someone who has lost their job that their tax money should go to help buy a foreign car. Personally, I think the sales tax on low North American content cars should be triple the rate on High North American content models.

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Your loyalty to U.S. jobs is admirable and I once felt the same. Although, those folks that have lost their jobs are at least partially responsible for the irresponsible way that their unions have priced themselves out of the market and for the reprehenisble "work practices" that their union fought for. I was a line supervisor for about half a year as part of my development at GM. I once had to watch 35 workers all sitting around while we waited an hour for an electrician to come to throw the "off" switch so the plumber could make a 10 minute adjustment to my assembly line...then wait again for another hour or so waiting for the electrician to come back and throw the switch to the "on" position. I couldn't throw that switch (member of management), none of my line workers could throw that switch (outside their classification) and the plumber (skilled tradesmen) couldn't throw it either even though all of us were thoroughly familiar with the line and the switches. That little 10 minute adjustment cost us over 70 hours of lost productivity...just due to union work practice rules. So...it wasn't just the high wages and high benefits.

There is plenty of blame to go around for GM's misfortunes (both for management and labor alike)...and they've all had plenty of chances to do it better. Now I'm running all-American made biodiesel in my VW Golf TDI (diesel) 'cause NO U.S. manufacturer produced any diesel passenger car. I was forced to choose between American manufacturing and American biodiesel support.

HarryN said:

If someone figures out how to make a car go 1,000 miles on 1 gallon of gas, go for it.

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This last summer I traveled about 10,000 miles in my VW and didn't consume even a single gallon of petroleum! I ran on 100% biodiesel. Heck, even my crankcase oil is fully synthetic (made from natural gas). We need very much to get off of the imported oil habit for our economic and national security. We already have the technologies for biofuels and PHEVs. We simply to need to focus on this as a priority.

I think Darell is right. The taxing agencies are afraid that hybrids will become so mainstream that they will lose a significant part of their income. If they impose the tax before hybrid owners become the majority they can do it with minimal outcry. If they try it 5 years from now, when most cars will be hybrid, they will have to fight the normal tendancy of people protecting their own interests.

Here in Central Ca, I see several Priuses (Prii? ) every time I go out of the house, even if I'm only driving 3 miles. They have become mainstream in my town. Yes, I know I live in Yuppy-Ville.

An interesting incident that supports the fear of hybrid theory:
The Bay Area Transit Autority (BATA) collects tolls on bridges in the bay area. They successfully lobied to have the hybrids exempt from the law that required toll free access to bridges if that treatment was granted to any other class of cars. Further, they had the lawmakers REQUIRE that hybrids in the bay area apply for a BATA fastrack transponder as a prerequisite for getting car-pool lane stickers. Their reason was a fear of losing too much revenue.


Here's a clever thought....

If I give up my 4 ton SUV that burns 15MPG to buy a 1.5 ton Prius that gets 50, will the decrease in road damage actually make up for the reduction in tax income? Just a thought.