How do cars that use alternative fuels pay road tax?

General Questions
#1

Electric, hydrogen, etc.

The Prius, while electric, still fills up at the local gas station. But if I buy a Volt and plug it into my wall at night, am I liable for any state/federal road tax? How is it computed?

Do vehicles that use hydrogen, CNG, LNG, or any other fuel pay road tax? How? Is the tax based on energy content (e.g. BTUs) or volume?

As a side question: Is the road tax on E85 (85% ethanol) the same, per gallon, as gasoline. E85 has about 30% less energy (and hence, poor mileage) than gasoline.

#2

I think this would be extremely location-dependent. What jurisdictions are you in?

#3

How is it calculated for gasoline powered cars where you live? We pay our equivalent tax to the town when we register our cars, and not using gas won’t avoid that tax.

#4

Federal (and state) road taxes are added to the price of gas and diesel.

#5

Each gallon of gasoline I buy has tax built into its price, both for the state (.20/gallon in Texas) and the federal government (.184/gallon).

#6

In most states there is an additional yearly fee to register you car. It can vary from a somewhat nominal charge of around $50 to hundreds of dollars based on the value of the car.

#7

There are a lot of states that are considering either flat taxes on alternate-fuel vehicles or electronically-tracked per-mile alternatives to the gas tax, but to my knowledge none have implemented anything yet. The flat tax on alternative fueled cars is seen as a little counterproductive since the Feds and most states are trying to subsidize them.

#8

I don’t think I’ve heard of a “road tax” by that name before. Taxes are usually named after how they’re collected (e.g. income tax, sales tax), not what their revenue is spent on.

#9

Here in the great state of Washington, the legislature yesterday passed a $100 road tax on electric vehicles. Tree-huggers expected to man the barricades any moment now.

#10

For now, electric cars get off scot free in most places. I am not sure if natural gas and propane used as motor fuels are taxed. I suspect they are.

#11

Motor fuels taxes are levied only on gasoline and diesel fuel intended for on-road use. Even farmers can buy untaxed red-dyed fuel for off-road use. No fuel taxes on propane or natural gas.

As mentioned, there are various discussions and experiments with using an actual mileage fee based on GPS data or odometer readings. Even though there are good ways to mask and randomize data, there probably will be big political fights over the privacy implications of such a switch.

#12

Here in Massachusetts, USA, we pay $0.42 per gallon in road-use tax. So if you drive 15000 miles per year and get 30 MPG (13 km/l), that’s $210 in road use taxes. When I looked that up, it surprised me that “Taxachusetts” is below the national average of $0.48, until I considered …

I pay 2.5% of valuation in “excise tax” (property tax) every year. That declines as the car ages, but let’s say it averages $250 per year. That puts Massachusetts way above the national average.

And then there is sales tax on a new car plus the annual registration fee of $45 or so.

Surprisingly, I consider the road-use tax on fuel to be one of the fairest taxes because there is a fairly high correlation between road wear and fuel consumption. This assumes that the road-use tax is used only for roads and roads receive no other funding.

#13

^ It would make more sense to me if it were correlated with mileage.

#14

It actually does make a bit of sense having it correlate with fuel usage, because (as Cecil briefly discusses in this column) heavy trucks are responsible for the great majority of actual highway wear. Heavy trucks also use more fuel and so they pay more road tax (in addition to various other DOT fees). You could also probably extend the idea and say that a little fuel-sipping compact causes a lot less road wear than a big gas guzzling truck and so it’s perfectly fair that the truck pays more.

#15

I think that it’s mileage based, also. The vehicle has to exceed 20,000 mi/yr or some such.