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Arizona Considers Charging Electric Cars Tax At 1.43¢ Per Mile

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Taken in Lisbon, Portugal. Pre-Production Test.

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For many years, Arizona was considered an electric-car friendly state, thanks to California-style tailpipe emissions and mandates which required automakers to sell a certain percentage of zero-emissions cars in order to sell in the state. 

But less than a month after the Arizona Governor’s Regulatory Review Council voted to repeal the state’s Clean Cars law and adopt the less-stringent emissions standards set out in Federal law, the state is now considering charging a pay-per-mile tax on electric car use. 

Arizona House Bill 2257 -- introduced by Rep. Steve Farley (D-AZ) -- is modeled on proposed Oregonian legislation and would charge electric car owners up to 1.43 cents per mile travelled.

Like the $100 per year tax being proposed in Washington state and the electric car electricity tax being discussed in Kansas, the proposed Arizona tax would be the electric car equivalent of the tax currently levied on gasoline purchases statewide. 

Like the gasoline tax, any funds from the pay-per-mile tax would be spent on maintaining the state’s road network. 

“One of the only ways we pay for our roadways is through gas tax, so if they’re not paying into the gas tax system we need to find a way of closing that loophole, and getting them to pay for the roads they use,” Rep. Farley told the Cronkite News. “It’s only fair that we pay for the things we use.”

The majority of electric car owners in Arizona agree, according to Jim Stack, president of the Phoenix chapter of the Electric Auto Association. 

“Someday it’s all going to be hybrids and electric vehicles,” he said. “it wouldn’t do us any good if we didn’t have any roads.”

But some consumer groups, whilst acknowledging the need to devise a tax system that ensures electric car owners also pay towards road upkeep, have pointed out that the tax could be too much, too soon. 

Given the relatively high sticker price of most electric cars on the market today, they argue, an additional taxation system may put off prospective buyers from making the switch. 

Diane Brown, executive director of Arizona Public Interest Research Group, had a stark warning to make, despite supporting the taxation of electric cars. 

“Any policy that is accounting for electric vehicles should be incentivizing, not discouraging,” she said. 

Just how should electric car owners be taxed to help pay for the roads they use? Are taxation schemes too harsh? Have they happened too quickly? Will they discourage electric vehicle adoption? 

Let us know in the Comments below. 

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Comments (35)
  1. Make Prius owners pay .005 per mile then. If they sold their Hummer and bought a Prius, then they are "taking gas tax off the table".
     
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  2. It sounds like a reasonable idea. But it seems like most roads in the US are crap anyway, all the money goes to highway projects in the cities while all other roads are left to rot. If they're going to tax us we should get a say in which roads get fixed, I live fairly close to a city thats in the middle of putting up a new over pass system to help traffic flow its costing almost 400 million yet all the city streets are in horrible condition. We should get a say in where these taxes go because our current tax dollars are in the hands of morons.
     
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  3. how do they calculate the number of miles driven ?
     
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  4. simple, use toll-roads
    This way all users are taxed same way
    Else you could just avoid the tax by getting a license-plate in an other ev-friendly state!
     
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  5. Arizona is becoming one of the worst states to live in because of its redneck government. Even the Dems in this state are stupid. If they tax my LEAF, they had better fix roads here in AZ with the money.
    I can always register my LEAF in CA. where I have I we have a home.
     
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  6. william, at least you acknollege that the Dems are the culprits and you can't run and hide from them in california
     
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  7. it isnt simple, at all. toll roads are a horrible inconvenience.

    i know it is a big assumption, but let's just naively assume that the govt actually uses the money for roads. the ultimate goal is to make everyone pay for his "breakdown" of the road being used.

    part of that is how often he uses it. but maybe even more importantly, is the weight of the vehicle. i would think that a semi does a lot more damage to a road surface than a hummer.

    which in turn, does a lot more damage than the leaf.

    having this as part of "the tax" might also encourage people not to buy more than they need. i mean, just how many people "need" a hummer ?
     
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  8. Where I live, in West Virginia, we have a large tax on an "inspection sticker", license plate sticker tax, a huge gas tax, and a model year tax, and our roads are still terrible. They use the tax for everything except repairing the roads. If they include a "miles driven tax", they would have to add that tax to every vehicle on the road or it would be an unfair tax, and if you own a hybrid, you are going to be double taxed. If they are going to add a tax for miles driven, then it should be the same the gov. pays you for miles driven using you private vehicle for their business, which where I live is .04 cents per mile.
     
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  9. It's only fair that everyone contribute, but they need to remember that the vehicles that do the most damage the roads are the large, heavy ones. The tax should be lower for EVs, not only as an incentive to drive one, but also because they cause less damage.
     
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  10. There is only a handful of electric cars on the road at this point and slow sales indicate that's not going to change any time soon. So I wonder why all those politicians are so eager to make them pay. It's hardly as if the roads are doomed now because the government is missing out on any serious cash and the nascent EV industry really needs a friendly fiscal climate to get a chance. It's almost as if these politicians take their cue from lobbies out there that don't want EVs to succeed.
     
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  11. The conspiracy theorist inside of me tells me that they are actively discouraging people from buying EV's to keep big oil contributions coming into their election campaigns.
     
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  12. If my math and reasoning are correct then that amount of tax would put electrics at ~31 MPG (~45 cents/gallon is what we currently pay.) So quite a few compacts and even mid-size vehicles would end up paying less. What a bunch of a-holes in AZ.
     
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  13. They should charge tolls to every vehicle, rather than single out electric cars. Trucks really pound the roads, and I doubt that tax on diesel fuel is proportional to this.

    Plus, this is surely a "solution" in search of a problem? How many electric cars are on the road? How much money is saved due to reduced air pollution? And every dollar saved by not buying foreign oil means it stays in the local economy, so there are lots of savings from electric cars.

    I smell a knee-jerk Republican scheme to fight what they perceive as President Obama's policies.

    Neil
     
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  14. I agree; the taxes on my Leaf were huge; If the Government wants road taxes, let them start collecting in the third year after the initial taxes are used and make it simple, $100 more on the registration. As far as the Republicans are concerned, one must realize they have supported oil for far too long; there are over 250 different federal subsides amounting to Billions, to keep the price of oil low, even at $4 a gallon.

    In effect the oil lobbyists nation has bought off the whole Republican party with favors and election campaign funding.
     
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  15. NEIL...did you read the article...a demacrat is proposing the tax...or should i say...DUMM A CRAT
     
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  16. we basically want a system that is fair, without being cumbersome, or requiring a large enforcement system.

    i am guessing that one of the easiest ways of accomplishing this is a tax on "electrical use" past a certain limit.

    for the past couple of years, edison has been installing smart meters. that no doubt will be a nationwide system, eventually.

    we are entering the "electric age".
     
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  17. We've been entering the "electric age" for a 100 years..by the way,all the plastic in these new cars are made from oil..
     
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  18. Lets see 1.43 a mile I drive 48 miles to and from work, so it will cost me $68 dollars a day to commute in my Leaf and it cost me $10.00 in gas in my Truck
    I guess the Oil company's win again as usual.
     
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  19. You got the decimal place in the wrong place in your calculations. It will $0.68 tax per commute, not $68.
     
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  20. AZ does seem to be trying to be the #1 'we hate any progress' state. As an EV owner, I think that I'd like the flat $100.
    It seems that AZ wants to unfairly tax EV drivers and that's really silly.
     
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  21. Arcane transportation formula that would never fly but seems fair to me should factor in: Weight + Miles driven + carbon footprint - charged all vehicles at refueling/charging - that way even monster semi-trailer trucking going through the state contribute to the road destruction they cause. Rates are the same on business as on grandma without any related tax write off or increase in taxing for travel. The challenge are people/businesses on the border of states w/out such a charge.
     
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  22. My personal feeling is this is a another red herring from the Tea Baggers . After all we can't have them damn hippies not paying their share even if Billionaires get a free pass. Go yell at the squirrels stealing your bird seed and ignore the bankers stealing your pension.

    But I won't argue against EV owners paying their "fair share" for road maintenance.

    I would be ok with a REASONABLE mileage surcharge added to yearly auto registration but, not if it involves some sort of intrusive tracking or a second home power meter.
     
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  23. The problem is the devil is in the details and as usual the ALEC weasels have stacked the deck against alternatives.

    A 1.43 cents per mile TAX means a Nissan Leaf owner would pay the equivalent of $1.42/gallon in TAXES, a Prius owner would pay $ 0.72/gal. in TAXES and the average 80,000 lbs. truck would pay $0.08/gallon tax. Which causes more wear and tear on our roads a Nissan Leaf or an 80,000 lbs. truck?

    The current Arizona fuel tax rate is $0.18/gallon So an Arizona Prius owner pays approximately 0.36 cents per mile travelled. Even an owner of a Ford f-150 4x4 pickup only pays 0.86 cents per mile in Arizona. Again, which causes more wear and tear on our roads a Nissan Leaf or a larger and heavier 4x4 pickup?
     
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  24. This means that, for tax purposes, the Nissan Leaf is equivalent to a vehicle that gets 12.5 miles to the gallon. Not too many cars/trucks get that kind of mileage these days.
     
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  25. Sounds like a typical Arizona wing-nut solution. First of all, the vehicles that destroy our roadways are not electric cars but over-the-road trucks. Secondly, am I crazy or does 1.43 per mile sound wildly usury? I can travel the whole length of the NJ Turnpike for something like 15 bucks. If I guy a gallon of gas what is the tax on that. Even if it were $1.43 that would work out to about 7 cents a mile at 20mpg. Less at higher mileage.
     
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  26. My LEAF costs about 2.5c per mile to operate. A 1.5 cent tax per mile would represent a 60% taxation on my fuel costs.

    Arizona put 19c on a gallon of gas. That about a 5% tax rate. The average mileage is the USA is 22 miles per gallon. So the tax per mile for gas cars is about 0.82 cents per mile.

    A smidgen bit unfair don't you think?
     
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  27. This law would be a disaster to a nascent industry that has enormous potential. I'd rather see a gasoline/diesel surcharge (which would only need to be a fraction of the $1.43 and staged over time to increase as ratio of EVs to ICE vehicles increases). The per mile idea is an invasion of privacy and personal liberty issue and should be opposed on that basis. Certainly, commercial electric vehicles should be exempt -- these haulers of people and cargo are being killed by high fuel prices now. We need some new thinking on this issue.
     
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  28. the responses to this article illustrates the HUGE misunderstandings we get by reading what we want to read.

    my Prius costs 8 cents a mile to drive in gas purhases. my Leaf costs less than 3 (2.65-2.9 cents per mile). add this tax to my Leaf and it brings to price to "just about" 4 cents per mile which is still about half the cost of the Prius.

    now this is AZ where the likelihood of having solar and PAYING NOTHING for electricity for your EV is high. so this tax is a way for you to help support the road system since most of that comes from gas tax. i see no problem with this. i do think that AZ should wait a

    and for those of you who posted that it would cost you $68 to commute in a Leaf. were you in a conscious state when you wrote that
     
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  29. The problem is the proposed tax is 2-4 times higher than what others pay via the fuel tax!

    The other potential problem is how the mileage will be tracked. IMHO, A yearly odometer check would be less invasive to privacy.
     
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  30. The price is way to high. $1.43 a mile, if we end up paying $4 a gallon and half of that goes to the state, thats like paying $2 for a min of 10-20 miles now. If we traval an average 40 mile commute, home to work and back, that would be almost $60 a day. Wow, am i understanding this correctly?
     
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  31. It would be 1.43 cents per mile.
     
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  32. Road costs are determined by load carrying ability and weather (particularly freeze/thaw). This tax is clearly intended to counter the incentive of buying EV's and subsidize the incumbent oil industry's road use taxes. The only thing encouraging about this story is that the backers of the oil industry are retreating from preventing progress, to discouraging progress. In a few years they will retreat further to the point of profiting from progress until that "progress" is no longer progress and then they will simply repeat the cycle...
     
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  33. I'm a Leaf owner in CA and I'll gladly pay the highway tax if I get a rebate pro rata of all the subsidies given to the oil industry and the 2 trillion dollar Iraq war... and I'm not paying for the countless respiratory problems in Phoenix caused by vehicle pollution.
     
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  34. First I read somewhere else that they are proposing a 1 cent/mile tax. Couple of thoughts!
    1) I drive my Suburban 12,000 miles (get 15 mpg) Pay $3.25/gallon Spend $2,600.00 on gas (800 gallons @ 3.25). Arizona collects $152.00 tax (.19 x 800 gallons),(AZ gas tax is .19/gal)
    2) I drive my Leaf 12,000 miles, costs $326 in electricity; Arizona collects $21.51 tax on elec, then I Pay Arizona .01/mile = $120 (milage tax) I then spend the money I saved ($2,600 -$120- $326) $2,154 on the local economy and Arizona collects $133.36 in sales tax(6.6%). Twenty-six hundred dollars spent generates $274.89 for Arizona ($21.51 +$120.00 + $133.36). Arizona gets almost twice the tax on my Leaf vs my Suburban.
     
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  35. EV's are far smaller and lighter than their gas-guzzler counterparts, especially the idiots tooling around in trucks hauling NOTHING thinking they look cool, while getting 10 MPG! If you want to be fair, charge THEM an emissions tax! The worse their mileage, the higher the tax! Now THAT'S fair! Do you charge pedestrians walking on roads? Do you charge bicyclists? Scooters? Mopeds? or any of the array of UNLICENSED vehicles using the roads? Don't single out EV's for YET ANOTHER tax as they're the only motorized vehicles helping the environment!
     
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