Gas tax reform should be on the table

But not for the reasons you might think.

As the growing EV sector cuts into fuel demand and consumption goes, so drops the fuel tax levies assessed by almost every level of government. That’s part of the bragging rights of EV owners – “we don’t have to pay that tax, or buy that fuel”.

Which is substantially true. No gasoline or diesel purchases, no fuel taxes paid. This doesn’t mean that driving an EV is cost free. It isn’t. Purchasing electricity through retail charging stations often draw a sales tax, charging at home increases your hydro bill – even though its far less than the cash output by internal combustion vehicle owners.

But what doesn’t change is the need to maintain critical transportation infrastructure. Roads and highways, traffic management, etc..these are all costly items used by EV and non EV users alike.

If you were to fly a drone over top of a massive traffic jam in any North American city, I doubt you could tell the difference between the vehicles of the two varieties of energy consumption.

This is the problem. EV’s occupy a space on the road no different than your previous gas guzzling SUV and apply wear and tear like all other cars and trucks. With rising uptake of EV’s over ICEV’s – the revenue drop from gas taxes will be irreversible. Even if the need to maintain the upkeep of our roads will not.

EV users aren’t looking for a free ride, even if there may have been some significant tax incentives to make the switch.

Full disclosure, my name is on a list to purchase a new EV when it’s available.

We’re making the switch because we’re doing our part to stem the use of fossil fuels, and in my jurisdiction, BC, the highest uptake for EV’s in Canada is right here. Sure, I’d like to save some money on gasoline purchases, but I need the roads maintained like everyone else.

So its time to reform how we look at this.

Gas taxes were easy. Everyone drove a car that requires gas or diesel, just charge a premium at the pump. Government makes a quick buck and is able to fund roads, etc. With the advent of higher efficiency engines and now EV’s, the revenue stream is under threat.

Instead of charging 14.5 cents a litre for gas taxes, perhaps we should apply a per-vehicle fee because you have a vehicle that is driven on public roads.

EDIT: I might leave 2.5 cents/litre of this tax in place in recognition of high fuel consuming vehicles and out of jurisdiction drivers who wouldn’t be subject to a per-vehicle levy as outlined in this article.

Look at it this way, there are approximately 3.7 million licensed vehicles in BC. The provincial gas tax revenue brings in almost $500 million. A straight across the board replacement would see the gas tax removed and a per-vehicle annual charge of $135 imposed (at the time of re-insuring your car).

EDIT: The $135 annual per-vehicle levy could be scaled up or down depending on the road safety record of the driver whose insurance policy covers the vehicle in question. (safe driver discounts).

I would support a continuation of the carbon tax as its a specific application and it could be further utilized to fund the electrification of our roads and highways.

Alternatively, one could have a mileage tax or per-km levy (which could be difficult to enforce or liberal usage of tolls (all bridges and access points); but that smacks of a discriminatory philosophy against those who live well outside the city, rural areas, or cannot avoid vehicular use for work reasons. Not everyone lives in a condo tower in the west end, Metro-Town with quick access to a sky-train.

I should add that I am not at all married to this idea. If there is some better plan to fund our highways, byways and transit, by all means speak up. But as we shift away from fuel consumption, alternative ways to source this revenue are needed.

My2bits

Published by

islander1974

40ish leftish, mouthy-ish. My politics are clearly left and I'm tired of compromise with the neo-liberal right. They've driven a wedge with their money based centrist politics. We used to be able to do great things and we can again; we just need the leadership to do so; and folks to say as much.

2 thoughts on “Gas tax reform should be on the table”

  1. This is something that needs to be discussed at convention or at Provincial Council.

  2. In all honesty, its a policy idea that is free to anyone to take. I am pissed off up to my ears to hear a bunch of neoliberals squawk that capitalism doing capitalistic things is making capitalism unafforable so the taxpayer should bail out their capitalism. Fossil fuels get more than enough taxpayer money; but since there is only one layer of taxpayer, its on all of us to fund our own transportation needs while doing the right thing for the environment. EV’s aren’t perfect either, and regardless of car/truck, they occupy space on public roads which needs upkeep. My suggestions here largely detach the revenue needed for such maintenance from the energy needed to power your vehicle. I don’t foresee fuel prices coming down significantly ever again. The price of fuel is going to drive this EV vs ICEV debate going foward.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.