According to today's edition of O-No!, the Powers that Be are increasingly looking at the so-called VMT (Vehicle Miles Traveled) tax as a way to offset declining gas tax revenues.
Talk of a Vehicle Miles Traveled tax has long been discussed as a necessity in a decade or so, because cars are becoming more fuel efficient, and states and the federal government are losing gas-tax revenue.
But there is now a sense of urgency about the new VMT tax. When gas hit $4 a gallon this summer, Americans sharply curtailed their driving. And when the economy cratered this fall, the driving rollback continued, even when gas prices plummeted.
We've discussed this previously, but at the time the concept seemed to be a non-starter based on comments from some well-placed insiders. Here are the basic arguments:
For the VMT
David Farren of the Southern Environmental Law Center said he supports a VMT tax. He said the tax would encourage people to live closer together, lessening the impact automobiles have on the environment. The government should not only encourage people to use less gas, but also to drive less, he said.
“The gas tax is good from an environmental perspective, because it directly taxes you based on how much you are polluting,” Farren said. “But there are other policy considerations based on water quality, and loss of open space.”
On the other hand:
Farren was critical of the transportation committee's study, saying it focused on finding new ways to get money instead of considering other ways to move people. “They want to continue a 1950s method of transportation,” Farren said. “They just throw money at old solutions, like beltways.”
I believe the VMT tax is a bad idea. For two reasons.
1. It's complicated. For the fairest applications, a new layer of technology will be required to manage all the billing customization - technology that comes at a cost both in terms of dollars and privacy.
2. It's regressive. People living in rural areas, who tend in general to have lower incomes, have to travel farther in almost every aspect of their lives - going to the grocery store, to school, to work, to church, wherever.
The dozen or so people I know who would be disproportionately affected by the VMT are already stuck between a rock and a hard place. Those who rent can't afford to relocate to more urban areas where prices are prohibitive. Those who own their homes are mostly underwater, with no hope of selling their homes in the near to mid-term. Farren's notion that the VMT would encourage people to live close together, while commendable in concept, seems dangerously naive at a time when people are up against the economic wall.