26
votes
The US EV and hybrid vehicle tax increase tucked into Donald Trump’s ‘Big Beautiful Bill’
Link information
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- Title
- The Tax Increase Tucked Into Trump's 'Big Beautiful Bill' - Inside Climate News
- Authors
- By Lee Hedgepeth, Marianne Lavelle
- Published
- May 23 2025
- Word count
- 777 words
The idea of metering a fee based on distance traveled is a more appropriate plan. Layer in the weight of the vehicle and you're really getting somewhere.
A flat fee on a vehicle that does not consume fossil fuels (even when pegged to inflation) is a lazy and backwards solution.
So it makes total sense that's just what our backwards and captured legislators will do.
I've been an EV owner for 8 years. I'm not opposed to paying a reasonable fee for making up for lost gas taxes, though given that EVs are still a pretty small percentage of the vehicles on the road and we want to encourage their adoption I don't really think the fees are appropriate right now.
But $250 is equal to a 9 mpg vehicle going 12,000 miles a year, which is just punitive. $100-$150 seems reasonable, even though the last gas car I owned got 40mpg and wasn't a hybrid, so it would only contribute like $50 toward the gas tax. But a lot of the EV owners I know drive 8,000 miles or less a year, so the current proposal is just crazy high.
For some additional comparison, I pay 5 cents per kwh and my car gets about 4 miles per kwh, so 12,000 miles costs about $150 in "fuel". The additional $250 fee would fuel my car for another 20,000 miles a year. For me, this fee is like gas going from $3 a gallon to $8 a gallon, with the difference being nothing but taxes.
Many states already have fees for this in place, and my state has annual inspections where they can easily track the actual number of miles driven. Combine miles driven with the weight of the vehicle to get an actually appropriate number. A Chevy Bolt that just gets driven locally for 5,000 miles a year isn't the same as a Tesla Cybertruck that drives 15,000 miles a year. If they did that, I would have zero complaints as long as the fee was actually comparable to gas cars and not higher just as a punishment.
From the article:
There was discussion of a uniform $20 Federal registration fee on all vehicles to prop up interstate highway transportation funding after decades of fuel economy increases that cut Federal gasoline tax revenues.
The original article notes that the EV/hybrid Federal charge would be applied on top of registration fees already charged by states. Given the Republican Party's known attentiveness to fossil fuel agendas, this punitive tax isn't surprising. In states like Alabama, this could amount to an extra $200 per year on top of the Federal charge, with no regard for miles driven.
I have somewhat mixed feelings about this law. It's true that EVs and hybrids are using interstate highways while paying less for their upkeep. They're significantly heavier than ICE vehicles, and contribute disproportionately to road wear-and-tear per passenger-mile. Even so, the lack of indexing for consumption, which is built into the gasoline tax, makes this flat fee patently unfair as well as regressive in terms of reducing carbon and other air pollution.
I’m not against increasing taxes to better deal with wear and tear, but it would be more fair to charge based on weight. Giant ICE trucks and SUVs have weights that are as high or higher than those of most EVs and hybrids, and they aren’t any easier on the roads. Bump their taxes up too.
Additionally, EVs don’t necessarily have to be heavy. BMW’s i3 weighed only ~2600lbs, which is less than what a Toyota Corolla weighs and is comparable to older Honda Fits. It’s possible to make a light EV, especially now with alternative battery chemistries popping up — the manufacturer just has to make that a goal. A weight-based tax would incentivize that.
I live in California. The cost to register my car every year is already about $250 for my Bolt. I think it was more like $275.
To make things worse, new laws doubled the minimum car insurance coverage so I am now paying multiple thousands of dollars per year for that.
It is just insane that we build our society around car ownership. It’s insane that it now costs something like two thousand dollars per year just for the “privilege” of owning a car, regardless of type, completely ignoring the costs of maintenance, upkeep, and fuel. And we haven’t even gotten to the fact that new cars average at over fifty thousand dollars, which is just under how much the average person makes in a year before tax. It feels like cars exist to make people into debt slaves.
I agree with you. I'm still resenting having to buy a car for work only because of a strict RTO policy (even if I love the car itself). It's equivalent to a 5 - 7% per year pay cut for the life of the car, not to mention all the other drawbacks of increased, unnecessary consumption... for a 10 mile round trip daily commute.
Having tried fiercely to make do with the minimal bus services available, I'd be delighted with an income-adjusted all-vehicle tax that goes directly into public transit subsidies and safe bike routes.