Autoblog

We certainly won't like it, but the undeniable truth is that our government will have to one day do something to generate more tax dollars from gasoline. The mere thought sounds crazy, with $3 per gallon gasoline lording over us like the British government vs. the colonists circa 1775. The fact is that the federal gas tax of 18.4 cents per gallon hasn't gone up since 1993, and as a result, inflation is eating away at the tax revenue our government "needs." Cars are also gaining in fuel efficiency, and gas electric hybrids and more ethanol-powered cars are on the horizon. The bottom line: drivers are paying less and less per year in taxes for the right to drive a car.

Enter researchers from the University of Iowa Public Policy Center, who have developed a system for charging you by the distance traveled, instead of by the gallon of fossil fuel. 2,700 drivers from Maryland, Texas, Iowa, North Carolina, Idaho, and California are testing a device that records the miles driven and gives drivers a receipt for the amount of taxes that would be levied if the experiment was the real deal. The study is being done to gauge public opinion of such a radical shift in policy, while also gathering information from a very diverse group of areas.

As a blogger that loves to drive, this idea stinks to high tax Hell. Politicians are too scared to make the unpopular decision to tax the already high gas prices, so they're spending big research dollars to find an alternative way to stick us with a bill. It's not like people that drive less would get a break. Those people already drive very little, and as a result they buy less gas, so they pay less taxes.

[Source: USA Today via The Truth about Cars]

One would not expect someone with a vested interest in selling cars to suggest a proposal that would cause people to drive less, but that's exactly what Mike Jackson is doing - again. This time around, the Autonation CEO wants to see an additional dollar tacked onto the price of each gallon of gasoline, as a means to shift consumer behavior and force a move towards vehicles with better fuel economy.

In an interesting twist, Jackson proposes that the amount collected from each consumer be returned on a yearly basis in the form of a rebate. In this way, the regressive effect of such a tax is said to be mitigated, but consumer behavior would still be altered. Upon first glance at the proposal, it would seem that giving an interest-free loan to a government entity would still cause more than a bit of pain for those at the lower end of the economic spectrum, especially considering that those consumers are often the least able to change their driving habits. Maybe we're missing something, though.

[Source: CNN/Money]

With gas prices rising politicians in states like Maryland, South Caroloina, Connecticut, Georgia, New York and Nevada are considering reducing or even eliminating their state's gas taxes to ease the burden on the average citizen.

This seems to us like a shortsighted solution designed more to curry favor with voters than actually ease anyone's financial burden. As the article from The Detroit News points out, state and federal gas taxes are levied when retailers buy their gas from distributors, so there's no guarantee those savings would be passed on to consumers instead of just being absorbed by retailers.

Add to that the fact that most state budgets have been operating at or near deficit levels and reducing or eliminating a major source of income seems like an idea that will lead to more potholes and less teachers in public schools.

Check out the article and let us know in the comments whether or not you think repealing state gas taxes is a good idea.

[Source: The Detroit News]

Spurred by high fuel prices, New Jersey governor Jon Corzine has introduced a plan to decrease fuel prices that would bring back the 55 MPH speed limit. OK, so it's only a proposal, and it's only one state, but pundits suggest that something like this could spread like wildfire in today's current tinder-like political climate. (As evidence of how weird everything tends to get when prices at the pump jump up, note that Republicans are suggesting oil companies pay a windfall tax to support a $100 fuel rebate).

As The Auto Prophet points out, fuel prices haven't really resulted in people driving under the current speed limit, so such a move would seem to make little sense from a practical standpoint. Of course, cognitive reasoning rarely gets in the way of a successful career in politics, though.

Sammy Hagar could not be reached for comment.

[Source: The Daily Record]

The Beaver State is investigating a new method of assessing taxes used to bankroll state highways. Instead of collecting money via gasoline taxes, Oregon is testing a GPS-based system which levels taxes based upon miles driven. By switching to such a system, the state would not lose revenue with every resident that purchases a more fuel efficient vehicle.

The 'black box' system keeps tabs on how many miles are racked up both in and out of Oregon's borders, as well as during rush hour, and levies taxes on the totals accrued. Predictably, the creation of a database that monitors the travel patterns of drivers raises some troubling privacy concerns, even for those who don't regularly harbor 'Big Brother' conspiracy theories.

As things stand, Oregon derives some 80-percent of its highway funding from its 24-cent-per-gallon tax, thus the move towards more fuel-efficient vehicles stands to negatively impact the state's coffers by millions of dollars.

What do you think, is this a viable alternative to standard gas-based taxation, or are the potential privacy issues too great to overlook?

[Source: UPI]

(Top tip, Chicken!)