Congress wants to follow Oklahoma in taxing EV operators to make them pay for the highway repairs since federal funding comes from gasoline and diesel fuel taxes.
A U.S. House committee led by Republicans approved a plan to create a $250 annual fee on electric cars but at the same time dropped a $20 federal yearly registration fee on all vehicles starting in 2031. The $20 fee was proposed to fund road repairs as part of a tax reform bill.
The House Transportation and Infrastructure Committee voted 36-30 to approve Rep. Sam Graves’ proposal. No Oklahoma members of the House sit on the committee. His plan also included a $100 fee on hybrids.
The highway trust fund faces a $142 billion shortfall over five years. “The system for funding our federal surface transportation is broken,” Graves said, according to Reuters.
EV advocacy group The Electrification Coalition, didn’t like the plan and called the $250 fee “unfair” claiming an average gas-powered vehicles pays just $88 a year in federal gas taxes. Revenue for federally funded road repairs comes from diesel and gasoline taxes and since electric vehicle operators don’t buy the fuel, they don’t pay the taxes.
Oklahoma is ahead of Congress in taxing EV operators to help pay for road repairs. The legislature adopted the “Driving on Road Infrastructure with Vehicles of Electricity (DRIVE) Act in 2021 and created a new excise tax on sales of “electric fuel” or electricity dispensed into an EV. The new tax took effect Jan. 1, 2024.
Under the year-old law, owners of EV charging stations are required to report and pay to the Oklahoma Tax Commission 3 cents per kilowatt hour (kWh). It does not apply to electric fuel coming from private residences for personal use.
Some states charge fees for electric vehicles to cover road repair costs. Congress for the past three decades has opted not to hike fuel taxes to pay for rising road repair costs. Some Republican senators in February proposed a $1,000 tax on EVs for road repair costs.
Some states charge fees for electric vehicles to cover road repair costs. Congress for the past three decades has opted not to hike fuel taxes to pay for rising road repair costs. Some Republican senators in February proposed a $1,000 tax on EVs for road repair costs.
Reuters reported the bill also includes $12.5 billion in new funding through 2029 for replacing aging Federal Aviation Administration facilities including air traffic control towers, radar systems and telecommunications infrastructure, and air traffic controller hiring.