House Republican pushing mileage tax to bolster Transportation funds; Update: Or did he?

posted at 10:21 am on February 6, 2014 by Ed Morrissey

Over the last few years, we’ve seen Democrats raise the idea of adding a new revenue source to supplement the gas tax, as revenues have declined from this stream due to increased fuel efficiency thanks to mandates to that effect imposed by Congress. One bad idea that never seems to die is a mileage tax, which would force Americans to track their travel — or have government do it for them. That idea got shelved along with the Democratic House majority in 2011, but now it’s crept across the aisle (via Instapundit):

House Transportation and Infrastructure Committee Chairman Bill Shuster said he favors user fees including a vehicle miles tax to pay for a long-term U.S. highway bill that would extend for at least five years.

Shuster rejected the idea of raising the nation’s 18.4 cents-per-gallon gasoline tax, now the primary method of paying for road, bridge and mass transit projects. Besides a mileage tax, he said other funding methods include higher taxes on energy exploration and bringing back corporate profits earned overseas.

Well, that’s just a cornucopia of bad ideas, isn’t it? Higher energy taxes in a stagnant economy disincentivizes investment and risk by adding cost, and it applies direct inflationary pressure to retail goods, especially produce. Taxing funds that corporations keep offshore is part of why those funds are offshore in the first place — a badly contructed corporate-tax system that puts American corporations at a competitive disadvantage. One thing that Transportation could do is strip out all of the pork-barrel projects that get written into the bill, which is usually among the porkiest of all appropriations from Congress. Maybe that extra cash can keep them busy for a while.  Even better yet, they could stop spending billions of dollars for high-speed rail in systems that don’t come close to crossing state lines, and let the states build their own toy choo-choo systems and deal with the massive bankruptcies that follow.

But of all the dumb ideas in that effort, the mileage tax is the worst. A gas tax is a usage tax, one that doesn’t require Americans to keep special records or for government to snoop into their driving habits. As I wrote almost three years ago, this is an entrée to massive invasions of privacy and IRS harassment:

One shudders to think what happens when the IRS gets your annual mileage wrong and a taxpayer disputes the record.  Where were you on the night of April 19th, Canarsie?  We show you drove 6.3 miles to Bada-Bing Strip Club in New Jersey. Even if exact destinations aren’t recorded (earlier suggestions were to use GPS devices), the taxpayer would get hit with a massive bill during the annual tax-preparation ritual with little or no chance to dispute the claims of the government.

Plus, let’s talk about equipment costs, both private and public.  This new tax system would require tracking equipment in every vehicle, which would mean retrofit costs for current vehicles and higher prices for new cars immediately.  What are the unemployed supposed to do — stop driving?  That should help when it comes to looking for work.

The government will either have to use GPS devices (that will track and record destination data) or install tollbooth passes every few miles on every road in America. The IRS will also have to set up an enforcement bureau to ensure that drivers don’t disable their tracking systems.  In California, this meant that every driver had to get biennial emission-control equipment inspections, an expensive waste of time and money for most drivers.  Will the IRS, which is just now branching out into the health-insurance inspection business, add a national DMV bureau as well?

Finally, do we really want to live in a country where the federal government virtually follows you everywhere you go?  Growing up in the Cold War, that’s what we were told the Soviet Union was like.  It will be the high-tech version of internal travel documents, or at the very least puts that power in the hands of the federal government.

This is a bad idea when it comes from Democrats, and it’s worse when it comes from Republicans. Perhaps the best idea would be to get the federal government out of the transportation maintenance business with the exception of those highways which are truly interstate, and let the states keep their money and deal with their own transportation issues.

Update: Bill Shuster is furious at Bloomberg, claiming that the piece materially misrepresented his position on this issue:

At Bloomberg Government’s “America on the Move: Investing in U.S. Infrastructure” event on Tuesday, February 4, 2014, House Committee on Transportation & Infrastructure Chairman Bill Shuster spoke about his vision for the next surface transportation reauthorization legislation that he and his committee will be developing in 2014.  During the question and answer portion of the event, Bloomberg’s Peter Cook asked Chairman Shuster about his ideas to fill the Highway Trust Fund.

Chairman Shuster’s response was as follows (excerpt taken from Bloomberg’s transcript), “Now, I do think we need to start the discussion on — and I don’t believe it’s going to be solve in this bill, but start the discussion on, you know, down the road how — is it vehicle miles traveled?  You know, what are the other ways to generate the funds?  Because the trust fund, we all know, everybody’s — in the next couple of years, we’ll all be driving cars going 50 miles an hour, cars that don’t use fuel, use electricity or some say use coal if you use electricity — 50 percent of it is oil; I like to remind that to people….”

Bloomberg’s Laura Litvan reported this comment as, “Mileage Tax Pushed by Shuster to Pay for U.S. Highway Bill.” With the Committee in the initial stages of developing the new surface transportation bill, Chairman Shuster was simply asking a question about the topic. As you can see, based on Bloomberg’s own transcript of the event, this headline misrepresents the Chairman’s comments.

Shuster is the first to raise “vehicle miles traveled” as one of the ideas under consideration, according to the transcript, after Peter Cook asks Shuster to cite “two or three” ideas to increase revenue for Transportation funding. He also added that the committee was watching a study from Iowa State on ten cities that were tracking vehicle miles, which Transportation apparently “expanded” in the last two bills:

shuster-xscript2

That leads directly to this exchange:

shuster-xscriptSo it appears that while it’s an overreach to say that Shuster is proposing this as a solution, it’s not quite the same as saying it only came up because the reporter asked about it.

 


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“He must be loony goony touched in the head, when he woke this morning , he should have stayed in bed…”, from a Bugs Bunny cartoon.

jake49 on February 6, 2014 at 11:40 AM

Didn’t Cato or Heritage endorse mileage taxes at some point? Might have just been a blog post, but the case was that you aren’t taxed unless you drive, therefore you might end up paying less.

Biggest problem though: prison planet.

LaughterJones on February 6, 2014 at 11:46 AM

That seat has been in the Shuster family for something like 21 terms now.

Time for a change? Not really… he has the safest seat (outside of the Dem inner city seats) of any Pa. congresscritter… except for maybe Joe Pitts.

either orr on February 6, 2014 at 11:48 AM

If more funds are needed to maintain vehicular infrastructure, then increase the mileage fees on heavy trucks.
1) The mileage is already tracked – so no increase in bureaucracy.
2) One heavy truck causes 20+ times the road deterioration as a passenger vehicle.
3) Whether it would begin this way or not, fairly soon the tracking of personal auto mileage will be done by in-car GPS systems. And it is impossible to know how far you have driven without knowing WHERE you have driven.

Rasputin1919 on February 6, 2014 at 11:48 AM

Someday soon it would be nice if people woke up to the fact that both the republican and democrat party are not looking out for us, our children or our jobs. Both parties are in bed with big business/pharma/oil/etc in a perverse shell game that is only about selfish power and influence. Tea Party is really our last hope (at least until they try to pervert it as well).
sic semper tyrannis!

great-unwashed on February 6, 2014 at 11:49 AM

Didn’t Cato or Heritage endorse mileage taxes at some point? Might have just been a blog post, but the case was that you aren’t taxed unless you drive, therefore you might end up paying less.
Biggest problem though: prison planet.
LaughterJones on February 6, 2014 at 11:46 AM

The principle is not new. It is essentially the same idea behind toll roads. The problem is that if the government takes mileage data instead, they get the power over where the money is allocated and who gets exemptions.

There is a cost to operating tolls, but methinks the costs of the government running a mileage tax system would be significantly higher and allow for rampant favoritism for exemptions and corruption in distribution of the funds.

In my mind toll roads > mileage tax. Way less potential for corruption, favoritism, and political pandering.

airupthere on February 6, 2014 at 11:51 AM

In their hearts they are all Democrats….

albill on February 6, 2014 at 11:39 AM

.
That doesn’t really capture “the spirit of truth”.

I’d change one word :

In their hearts they are all Democrats elites….

listens2glenn on February 6, 2014 at 11:55 AM

a five year tax, yeah right. another Republican against big government…

burserker on February 6, 2014 at 10:30 AM

That’s the main problem with the Republican establishment: they simply think they should be the ones driving the car, instead of the Democrats. It would go against the advancement of their personal interests to actually change the direction and destination of where the car is going.

LooseCannon on February 6, 2014 at 12:03 PM

New member, first post. Be gentle. So anyway. A Republican actually contemplates and tries to sell a mileage tax. Breathtaking. I really think the schism between conservative thought and theory, and the insulated dhimmi’s to the socialist Dems that the establishment has become is unbridgeable. The argument against this in the article are correct, but they do not really need to be explained to conservatives why it is so horrible. It is the spectacle of seeing a nominal member of the Party of Lincoln advance it. They are hopelessly corrupted. Focused removal of these horrid little people from office is the only way. This proposal is diametrically opposed on its face to conservative principles. Has he read anything by Hayek, or Sowell, or Locke? How does his head not explode if he actually has.? Primary the heck out of these types. Tea parties in these states should look hard at our own. The leaders will use their power to defend them. Make them do it. A 50 individual state movement to give these progressive doormats the trap door. Pick a name from the phone book for Christ’s sake. I’ll vote for it over a lackey like this.

Cliff by the Ford on February 6, 2014 at 12:05 PM

What airupthere said!

Dec_of_Ind on February 6, 2014 at 12:15 PM

Rep.Shuster is proof that RINO’s are just as much to blame as Dems are for Big Government’s intrusion into our lives.

NixTyranny on February 6, 2014 at 12:16 PM

For all the youngsters out there. I see a big business opportunity for an enterprising person to figure out a way to stop the spying and government overreach via technology.

unseen on February 6, 2014 at 12:30 PM

Why don’t we all save a lot of time and trouble and just send them all our money. They can give us a small allowance for discretionary spending and blow the rest on the infrastructure and climate hubs.

Kissmygrits on February 6, 2014 at 12:33 PM

Keep voting Republicans, dummies, because Republican=conservative.

truerino on February 6, 2014 at 12:34 PM

I can understand what the problem is. Roads need maintenance and with all the new hybrids and other fuel efficient cars, not enough money is being collected. I propose that the government tax the fuel efficient cars when they are purchased since they will never cover their fair share (and it’s all about fairness these days, isn’t it?) of road usage. It’s insane to create a mileage tax. We’re already losing enough of our freedoms. For those of us living in rural communities where public transportation isn’t an option, this is a real penalty on our way of life.

COgirl on February 6, 2014 at 12:36 PM

When Pork kings like Shuster can show they have cut the fat and done everything to reduce spending, I will be happy to entertain paying more for the roads.

Till then, No.

But, roads and infrastructure are a vital function for even the most limited government. Essential for a robust economy. And one of the things that makes us a great nation.

A gas tax was a workable solution when all cars ran on gas and most got similar mileage. Even regular gas engines are due to get over 40 mpg. Let alone electric vehicles that pay no such tax for our road’s maintenance, something should be done.

Maybe tax the EV and hybrids up front when they are sold. Based on the mileage calculated from the lifespan and capacity of the batteries. You want to drive that thing, you have to pay your fair share.

In no way should the mileage tracking be implemented at the Federal level. It is bad enough that most states already track your mileage when you get emissions inspections. Let alone how states use all the toll payment sensor data they already collect even when you are not going through tolls. At least this very private info is not currently used for taxing people willy-nilly.

Sisiphus on February 6, 2014 at 12:38 PM

The opportunity to sweep the Dems out of DC in large numbers is as good as I can remember but the Republicans are so incredibly stupid they’re gonna manage to blow it. This has to be an all time low point for the GOP.

Big Orange on February 6, 2014 at 12:41 PM

Who logs more miles driving to and from work? Rural or urban drivers?

This plan will get the overwhelming support of big-government city dwellers who don’t drive.

Also, as more and more people are losing their jobs thanks to Obamacare – sorry, make that as more and more people being freed from the damaging effects of job lock, finding work will involve expanding one’s search radius. The worse the job market, the further people will have to drive to go to work.

“Hey, let’s make it even MORE expensive for struggling Americans to buy food an clothes for their kids! That’ll show ‘em how much we care!”

Also, how will they differentiate between miles driven on public roads in the U.S. and those in Canada or Mexico? How about farmers who log a lot of miles driving on private land?

So much wrong with this concept.

Bruce MacMahon on February 6, 2014 at 12:41 PM

I respectfully disagree … It CAN be done.

listens2glenn on February 6, 2014 at 11:36 AM

The problem is that the majority of the states are also incredibly irresponsible and wasteful of taxpayer funds within their own budgets. Funds that should go for infrastructure improvements and maintenance instead are funneled to the coffers of the public sector unions who bought the same politicians who approve the expenditures.

COgirl on February 6, 2014 at 12:36 PM

You’re right. You’ve touched on one of the oxymorons of progressive government – they pass regulations to push for greater fuel economies in vehicles sold, then cry poverty when the revenues from gasoline / fuel taxes decrease because of the higher economies.

Of course, for the progressives, the solution for the problem is not better efficiency and prioritization in government spending, but creating a new intrusive method of taxation that will largely penalize those who do not vote for them.

Athos on February 6, 2014 at 12:47 PM

The best way is to do a mileage tax was when you register your vehicle every year with the state. Just write down your odometer and pay a 1-2 cent per mile tax. An one cent per mile tax is about the same as the current 18.4 cents per gallon for a 20 miles per gallon vehicle. A two cents per mile tax would be $200 for every 10k miles. There would be some odometer fraud but that already exists.

Usage taxes are generally the best way to fund things with minimum economic effects. I’d rather this than pay through general revenue. If you do general revenue, part of the money best used for roads will be wasted on public transit or politicians pet projects.

wambat on February 6, 2014 at 12:48 PM

If the federal tax on gasoline is first repealed in its entirety, then I might listen to the various mileage tax proposals being discussed.

Might.

Bruce MacMahon on February 6, 2014 at 1:03 PM

wambat on February 6, 2014 at 12:48 PM

This. But make sure you eliminate the gas tax (other than regular sales tax).

GWB on February 6, 2014 at 1:07 PM

Translation:

You or me may be concerned about it but our kids who are the product of the liberal education system are far too busy checking their Facebook and Twitter to care about silly things as their individual liberties.

I have heard enough, who wants to primary this clown he is obviously “evolving” on the issue.

Knives78 on February 6, 2014 at 1:08 PM

Perhaps if Rep.Shuster could learn to put two comprehensible sentences together it would help.

NixTyranny on February 6, 2014 at 1:08 PM

I propose that the government tax the fuel efficient cars when they are purchased since they will never cover their fair share

COgirl on February 6, 2014 at 12:36 PM

I really like your solution!

NixTyranny on February 6, 2014 at 1:16 PM

Schuster is off his rocker.

Here is a great idea. Instead of giving people a check for buying an electric car, via a tax credit, we should make people who buy an electric vehicle pay the Gas Tax Replacement tax.

I am not in favor of new taxes, but i think this one just subsitutes for the one that they are skipping out on at the pump.

The liberals love new taxes, surely they will love this one?

Fleuries on February 6, 2014 at 1:28 PM

Greasy scumbag politicians never stop trying to gouge the American people out of more tax money. Why don’t the trim back this bloated bureaucracy. We don’t needed the Dept. Of Commerce & the NEA for starters.

RdLake on February 6, 2014 at 1:39 PM

Taxing electric cars so they pay their fair share is a great idea. Tax all cars when you buy them based on their weight and fuel efficiency. Everyone pays a share of the burden for the roads. Beyond that, we still need an equitable way to pay for the roads. What ever happened to letting the market supply and demand effect the final outcome? I hear lots of moaning about the problem but have only seen a few posts about solutions. Sure a mileage tax has all sorts of implementation issues. What are other ways to fund the roads and bridges? Taxing a few hybrids and electric cars isn’t going to solve the problem. The rural community wants to be subsidized for their roads. They have fewer people per road mile and tend to drive more miles. The city people want mass transit subsidized so they can drive less in areas where there is heavy congestion and driving isn’t as practical. Fuel efficient car drivers want to be subsidized by not paying for the gas they don’t use but still want to use the roads. Throwing out the non conservatives, while it is a great idea, doesn’t fill a single pot hole. Solutions people, solutions is what we need, not more rhetoric.

argusx2002 on February 6, 2014 at 1:51 PM

Fleuries

I like your idea, obviously. Let’s call it The Road Use Fair Tax.

COgirl on February 6, 2014 at 3:12 PM

Update: Or did he?

Yes. He did.

besser tot als rot on February 6, 2014 at 4:35 PM

Just when you thought there was no
Hope for the GOP, it is confirmed.

Brock Robamney on February 6, 2014 at 5:38 PM

Well, how would you fund roads and highways if most of the vehicles were electric?

Socratease on February 6, 2014 at 6:14 PM

If they took the gas tax an all the other fees that the government put on us drivers, and used that money to fix roads and bridges instead of putting it into the general fund and letting these clowns spend it on pork barrel projects , the roads and bridges would be in great shape. Remember the wasteful spendng never stops, and more money is always needed.

savage24 on February 7, 2014 at 3:28 PM

When we can trust that you will not throw away gas taxes on bike paths an turtle tunnnels and other pork project then we can consider
more money. Until then we should assure that highway tax is spent on roads bridges etc

scboy on February 9, 2014 at 9:46 AM

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