EDIT: The additional Per Mile tax discussed in this article is different from the current IFTA agreement where drivers already have to track their movements and submit a quarterly report. In some cases, the new per mile tax may end up being in addition to all of the taxes that truckers are already paying.
The Oregon State Legislature has just passed a bill that allows per-mile taxation on vehicles using any road in the state. While the bill currently says the per-mile taxation is optional and it has not been approved for use with heavy commercial vehicles, this is certainly a step in a frightening direction. Get ready for a huge bump in taxes and a truly frightening infringement of privacy.
The idea of a per-mile tax is something that has been getting tossed around a lot lately as state DOTs are looking for ways to fill massive holes in their operating budgets caused by maintaining a rapidly aging road system. In some states, it is being considered in addition to or as a replacement to fuel tax since today’s vehicles are using less fuel, but causing the same amount of wear and tear on the roads. For truckers who drive rigs that commonly get less than 10mpg, it seems that a per-mile tax would cost less than a fuel tax in the long run. But it doesn’t.
Let’s take Oregon as an example. The state fuel tax in Oregon is currently $0.30 per gallon. If a truck gets 10mpg, that means the driver ends up paying $0.03 per mile. The per-mile tax that Oregon is proposing would charge drivers $0.015 per mile – half of what drivers are paying with the current fuel tax setup. This makes it seem like a great deal for truckers, but there are several factors that are not being taken into consideration here.
First, truckers may not have to pay fuel tax in Oregon, but most truckers don’t stay confined to only one state. Odds are, that trucker has already fueled up in a neighboring state, say California, and has already paid the $0.72 per gallon fuel tax there before driving into Oregon where they’re now being taxed again for every mile they drive. That comes out to costing $0.87 per gallon in taxes alone!
This doesn’t even take in to consideration the idea that trucks and other heavy vehicles might be taxed at a higher rate per mile due to their increased impact on the wear and tear of the state’s roads. According to a report released back in January by the U.S. Government Accountability Office, truckers would be expected to pay anywhere from $.03 to $.08 cents per mile, a far cry from the $.015 that light vehicles will be paying on Oregon.
The other major issues with per-mile taxation are the equipment that it requires and the privacy concerns brought on by that equipment. Every truck would need to have an always-on GPS system tied to the truck’s engine. From the time the engine goes on at the beginning of your day to the time it shuts off at the end it would be transmitting your exact position – along with the exact position of every other motoring citizen in the country – to a single government agency.
The new bill in Oregon may not seem like it has an effect on truckers (after all, it doesn’t even apply to heavy commercial vehicles!) but don’t be fooled. This bill is the first step in legislature that will see the amount truckers pay in taxes skyrocket to what the Government Accountability Office estimates at an average of $5,792 per year.
Next Story: Pilot Flying J is $4 Billion In Debt
Image Source: estateplanning