Should a mileage tax replace the gas tax?

Steve Berg recently posted an article on "Should a mileage tax replace the gas tax?" on following the Humphrey Institute's roundtable on the German model of distance-based transportation finance.

Berg captured a primary argument for the mileage-based tax: "A stagnant tax rate on gasoline isn't the only problem. As fuel prices rise, people drive less, buy less gas and pay less tax. The move to fuel-efficient cars, including hybrids, also lessens the revenue flow." At the same time, national studies have shown that we are significantly under-investing in transportation infrastructure in the U.S. A national commission shows the U.S. "spending about $225 billion a year on maintaining and building roads, transit, rail lines and other surface projects. Governments currently are spending about $90 billion. In other words, the country must find a way to increase its infrastructure investment by 2½ times in order to catch up."


The best feature of the German model is its incentive to shift traffic to cleaner, more efficient means of transport.
Germany pays $9.50 + for a gal. of gas. How much can we increase the price of a gallon of gas to fund 225 billion needed to update our roads, transit, rail lines and other surface projects. Mileage tax increase the cost of food and goods ship by trucks. It become another cost place on the shoulders of the American public when jobs are being lost and our economy is pushed to the maximum.

Hubert H. Humphrey Institute of Public Affairs