Fact #790: July 29, 2013
States Beginning to Tax Electric Vehicles for Road Use
The maintenance of our highways has traditionally been funded from a combination or Federal and state taxes collected at the pump from the sale of motor fuels. Because electric vehicles (EVs) do not refuel at pumps that collect state and Federal highway taxes, they do not contribute to the upkeep of the highways. This has caused many states to rethink how taxes are assessed. Some proposals call for changes on how all vehicles are taxed while others are focused specifically on taxing EVs through increased annual registration fees or per-mile charges. As shown in the figure below, Washington, Nebraska, and Virginia have already enacted legislation to begin collecting taxes from EVs while other states have proposed legislation. States not shown in the figure that are considering annual fees include Indiana, South Carolina, Texas, and Vermont.
- Nebraska and Virginia fees also apply to hybrid-electric vehicles.
- Arizona fees are based on the vehicle's annual mileage, with fee not to exceed $120/year.
- North Carolina fees for hybrid-electric vehicles are $50/year.
- Oregon fees apply to any vehicle with fuel economy above 55 miles per gallon and are based on the vehicle's annual mileage. Above estimate calculated for 15,000 miles/year.
Crain Communications, Automotive News, "The EV taxation debate comes to Michigan"
Crain Communications, Automotive News, "States debate taxing green cars to recover lost gas taxes" June 9, 2013.
National Conference for State Legislators, Transportation Funding and Finance Legislation Database, accessed July 2, 2013.
Autobloggreen, "Oregon proposes 1.5-cent-per-mile mileage tax for EVs, would also target 55+ mpg cars" March 3, 2013.