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Is the Vehicle Mile Tax a Good Idea?

George Herbert Walker Bush was elected president after he chanted, “No new taxes!” at the Republican convention back in 1988. Later in his presidency, when he violated that pledge, he failed to win reelection to a second term. When surveyed in 2008, then Senator Obama was identified by the voting public as being the presidential candidate more likely to lower taxes. It’s clear that Americans do not like being taxed.

Yet when congress passed the FAST Act last fall one conspicuous question was left unasked, “How are we going to pay for this $305 billion piece of legislation?”

The American Association of State Highway Transportation Officials (AASHTO) met in Washington D.C. recently to discuss transportation funding possibilities. They talked about adding toll roads and other possibilities. But the most favored way to generate additional transportation funding was a Vehicle Mile Tax (VMT).

A VMT would charge/tax vehicles per mile driven. Some favor taxing all vehicles. Some favor only taxing commercial vehicles. Either way, the general public would pay for them, either directly or hidden within higher priced commodities.

I have been a fiscal conservative for my entire life. So additional taxes aren’t going to sound like a good idea to me. On the other hand, on this blog we’ve talked about how we cannot just say no to every industry change that come up. If we want to move forward we have to come up with good problem-solving ideas. Otherwise the politicians and their staffs will come up with their own ideas.

I’m not saying we need to raise taxes and I’m not saying we don’t. But it is with that backdrop I highlight Sean Kilcarr’s article over at FleetOwner.com. Kilcarr quotes Peter Ruane, President and CEO of the American Road and Transportation Builders Association (ARTBA):

“We’re grateful that the FAST Act got passed but we’re not grateful that we side-stepped the funding issue again – we’re relying on gimmicks” like the $70 billion general fund transfer, he said.

 

“We need a long-term, reliable and sustainable source of funding,” Ruane emphasized. “The job is not done – not even close. Let’s not kid ourselves; we cannot paper this over. We need more funding.”

According to The Concord Coalition, the Federal debt stands at greater than $19.0 trillion. We cannot keep adding to the federal debt without ways to fund our spending or, just like your family finances, we’ll bankrupt our country.

This isn’t meant to be a political rant. I just want to point out that just like when we when we swipe the credit card, we have to pay the bill, when congress passes legislation to pay for things, we actually need to pay for them.

Thanks for reading.

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