(The Center Square) – Georgia lawmakers were presented a plan to offset revenue loss amid a transition to fuel-efficient and electric vehicles by enacting per-mile fees on drivers.
The state uses transportation fees and fuel taxes to support road maintenance and construction. New technology and President Joe Biden’s plan for 50% of new car sales to be electric vehicles by 2030 could reduce tax collections. Electric and fuel-efficient vehicles require little or no gasoline to operate.
Transportation expert Robert Poole told a legislative panel Monday the state should replace its fuel tax with per-mile highway fees to secure revenue as transportation evolves.
“We’re going to need to replace the fuel tax as the primary source of highway funding,” said Poole, the director of transportation policy at Reason Foundation and a senior fellow at the Georgia Public Policy Foundation.
Georgia’s fuel excise tax for 2021 is 28.7 cents per gallon. Georgians also are subject to varying local government motor fuel sales. According to Poole’s research, Georgia’s gasoline sales peaked in 2017 but have been on a steady decline since, dropping by 6.57% in 2020. Travel on the state’s roads fell in 2020 because of the COVID-19 pandemic. The pandemic led to business shutdowns and a temporary conversion to remote work.
Other states such as Oregon, Utah and Virginia have initiated pilot mileage-based user fees programs. Poole told the Joint Commission on E-Commerce and Freight Infrastructure Funding that Georgia also should test the program and conduct a study to evaluate projects’ time and cost estimates. Current mileage-based user fees models require annual odometer readings, GPS trackers and other monitoring devices, or a prepaid option.
Sen. Frank Ginn, R-Danielsville, said a mileage-based program would complicate things for Georgians who already are frustrated with the record-keeping requirements for paying income taxes.
“When I look at what you’re proposing here, I’m thinking about what a royal pain,” Ginn said. “So for me, I don’t think it gets much simpler than right now. We collect from distributors a gas tax. You’re paying at the pump. You’re gonna have to come up with something to keep it simple.”
Ginn said he also was concerned about the cost of the program and Georgians’ privacy.
The legislative panel was created to examine which funding and policy solutions could generate more revenue for Georgia’s freight, logistics and e-commerce industries.
By Nyamekye Daniel | The Center Square
