The Gas Tax is Running on Empty. How Governments Plan to Target Electric Vehicles Next

DM

The future is never certain, but some aspects of the looming fuel tax revenue crisis seem comfortably predictable. As bans on the sale of internal combustion cars and trucks begin to take hold, government fuel tax income will start a rapid decline. If, as expected, governments act to protect this important revenue source, we can expect new policies that seek to replace the gas tax — and these efforts will almost certainly include EV owners. Experience in the U.S. suggests the simplest solution is an extra registration fee on every EV. But such a system is also inherently unfair, since it requires drivers who don’t drive a lot to subsidize those who do. This, as well as various other reasons, is likely to push governments to prefer a technology-based solution based on kilometres driven. And that could open the door to a host of new driving charges that will revolutionize how — and how much — we pay to use the roads. Canadian drivers may soon find themselves wishing the future never comes.

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