The Hidden Cost of Improved Fuel Efficiency

Increasing vehicle standards means decreasing gasoline usage--and tax revenues. A new report suggests that a wholesale rethinking of how we pay for transportation infrastructure may be in order.
October 7, 2010, 1pm PDT | Lynn Vande Stouwe
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The study, released by University of Virginia's Miller Center of Public Affairs, points to a growing problem in transportation funding. Gasoline taxes have historically served as a user's fee, with taxes paid roughly proportional to miles driven, but with today's more fuel efficient vehicles, a mismatch between taxes paid and services consumed can occur.

The report suggests a better solution might be taxing vehicle miles traveled. Emily Badger writes:

'What's needed now is not a higher gas tax, but a whole new way of looking at how we pay our fair share for using public roads We shouldn't fill road coffers according to how much gas we buy, but how many miles we drive.'

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Published on Wednesday, October 6, 2010 in Miller-McCune
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