If you own a hybrid or electric vehicle, you probably feel pretty good about yourself. After all, you’ve made a socially responsible decision to help the environment, reduce your carbon footprint and improve air quality.
But you might feel a bit guilty, too. After all, you are in part responsible for the poor condition of our roads. Your car uses less gas per mile, so you pay less tax per mile too. Less tax means less transportation funding. Less funding mean worse roads—right?
Ignore the fact that the State of California wastes billions of dollars on bureaucracy and bullet trains. Or that the state took in record fuel-tax related revenues last fiscal year. If you’d only bought a gas guzzler instead of a green car, maybe our roads wouldn’t be in such poor shape.
Instead of telling you this truth, society rewards you with tax credits, rebates and special perks like access to carpool lanes and privileged parking spots. One legislator is now proposing cutting sales tax on green car purchases.
Even if you had to pay full sales tax, deep down you know that by buying a green car you bought yourself a fuel tax break. Each mile you cruise down the freeway adds to your savings.
Ordinarily, tax-and-spend legislators wouldn’t stand for such creativity in evading taxes. But for them, the alternative of pushing a “Prius Tax” poses major problems.
First, there’s a messaging problem. Liberals are used to taxing and regulating things they don’t care for, like cigarettes, plastic bags and, of course, gasoline. If they propose a tax on green cars, some might question their green credentials.
Second, there’s practical politics. The Prius is one of the top-selling cars in California. Few politicians want to tick off that many voters. Virginia politicians learned this lesson the hard way; last year they were forced to reverse a “hybrid tax” after an outcry from hybrid owners.
Last but not least, some politicians are conflicted. They want people to buy cigarettes but not smoke them. After all, cigarette tax revenues fund important liberal priorities like early childhood development programs. Similarly, liberals want people in eco-friendly cars but hate the thought of losing even one gas tax dollar.
This conflict is resulting in rather odd tax proposals. Rather than just tax the drivers who pay no fuel taxes, Assembly Speaker Toni Atkins has proposed that all drivers pay a new $52 “road user charge.” Under her proposal, a struggling Central Valley commuter who already pays plenty of fuel tax will get hit with a tax hike of the same amount as the Bay Area tech worker who currently pays no fuel taxes since he drives a brand new Nissan Leaf.
Fair? Not so much.
In a separate development, the Legislature has tasked the California Transportation Commission to study a mileage tax. The general concept is to find a way to make all drivers pay a fixed tax per mile driven, regardless of their vehicle. How the government intends to track mileage without invading privacy remains a mystery.
There’s little chance Sacramento will impose taxes on green cars anytime soon. But in the meantime, if you’re feeling guilty, you could always send the State of California an unsolicited contribution to assuage your guilt.
Maybe ask them to fix a few potholes, too, while you’re at it.