In The News

RAND Corp. urges switch from fuel taxes to VMT

Nonprofit research group RAND Corp. is urging the federal government to shift the way taxes are collected on highway users. RAND says the government should scrap the federal tax on motor fuels and replace it with a tax on vehicle miles traveled, or VMT.

While the concept of a VMT tax is intriguing to some, the concept is unproven and does not yet ensure the protection of a driver’s privacy, according to the Owner-Operator Independent Drivers Association.

Simply put, a VMT tax would require the miles a vehicle travels to be tracked so that taxes may be assessed accordingly. The more miles traveled, the higher the taxes the user pays.

RAND issued a report and press release on Wednesday, Feb. 10, urging the inclusion of a VMT tax in the next surface transportation reauthorization bill that lawmakers are currently drafting on Capitol Hill. Two federal panels appointed by Congress and former President Bush have also recommended a VMT tax as a way to fund transportation in the future.

At the state level, Oregon recently conducted a VMT pilot program and the University of Iowa is currently studying the method.

VMT supporters say that the fuel tax is no longer cutting it and that shortfalls in the Highway Trust Fund are directly attributable to Americans driving fewer miles and increased sales of efficient vehicles.

The reality, according to OOIDA leadership, is that the Highway Trust Fund would not be teetering on the edge of going broke if money stayed with highways and was not diverted to non-highway uses. OOIDA also points out that the economy has affected truck and trailer sales in recent years, causing the Highway Trust Fund to miss out on millions of dollars from the 12-percent excise tax on heavy equipment.

The privacy issue continues to concern the critics of VMT.

Suggestions for an in-vehicle metering system and the use of satellite tracking technology that accompany most VMT proposals have many people and groups, including OOIDA, concerned about the privacy of drivers.

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