EVs already pay their share

Dear Supporter,

Should electric vehicles pay additional road taxes? No way!

In a shortsighted response to falling revenues from gasoline taxes, every now and then some legislators and state officials call for a special tax on electric vehicles. This tax is supposed to make up for the "free ride" electric vehicles get because they don't contribute to the highway maintenance funds generated by the gas tax.

The facts of the matter? At Built by Michigan, we've done an analysis (PDF) of the tax revenues generated by electric vehicles and guess what: they're already paying their fair share.

While it is true that electric vehicles do not burn gasoline and so do not contribute to the gas tax, electric vehicles generate more in registration fees and sales taxes because of their relatively higher sales prices. Compared to their non-electric counterparts, electric vehicles contribute more gross revenue and more revenue per mile driven to the state coffers. So saying that electric vehicles get a "free ride" on our highways is simply not true.

In addition, electric vehicles are a very small part of the market today, so a tax on them is unlikely to generate much revenue. But imposing an additional tax on them could do a lot of harm to this industry, still in its infancy. And while electric vehicle sales are still quite low, increasing that market promises to generate jobs for Michigan workers and promote innovation in the state's dominant industry.

Instead of trying to strangle this new opportunity in its cradle, state and local governments should be doing all they can to support it. How can they help? Adding electric vehicles to state and municipal fleets is one idea. Financial incentives for more EV charging stations would be another. Imposing a special tax on electric vehicles could have terrible effects on Michigan's opportunity to put the world on (electric-powered) wheels.

Instead of looking for ways to tax them, we should be making it easier for people to buy and drive them. Won't you join me by sending this message to your friends, colleagues or business partners, and encouraging them to talk to their elected officials and sign our BBM petition?

Sincerely,

Charles GriffithCharles Griffith
Climate & Energy Program Director
The Ecology Center