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Don Ryan/AP
Portland, Oregon

Mileage Tax Proposal Causes Concern Over Privacy

February 19, 2009 08:59 AM
by Denis Cummings
Several states are considering replacing their gasoline tax with a mileage tax calculated by GPS systems installed in residents’ cars.

Mileage Tax Plan Would Track Drivers

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In a preliminary transportation plan revealed last week by The Associated Press, Massachusetts is considering a program, known as “Vehicle Miles Traveled,” to track drivers through GPS chips installed in their cars and charge them a quarter-cent per mile.

“Trips would be measured by a chip installed in a vehicle inspection sticker as soon as 2014, and in-state drivers would receive a gas-tax refund for their mileage to avoid double payments,” describes the AP.

The concept for a mileage tax was created in response to declining gas tax revenues due to improved fuel-efficiency in cars. “A greener, more fuel-efficient transportation system means that the gas tax will become a less viable (means) of funding our transportation system,” said Massachusetts Transportation Secretary James Aloisi in a document obtained by AP.

The idea has been examined by several other states, including Oregon, which successfully tested the GPS system in a trial involving 300 volunteer drivers. “They drive up to the pump and there's a mileage reader there, very much like a modern toll reader, which identifies the car as a mileage fee payer, and the total mileage driven in each zone is transferred by a wireless radio frequency that goes into a database, and the mileage fee rates are applied,” explained the Oregon Department of Transportation’s Jim Whitty to the Los Angeles Times.

Advocates for a mileage tax say that it is more fair than the gas tax because it taxes each vehicle equally for the amount of time it spends on the road. “What the mileage charge does … is simply charge for the basic responsibility of people to pay for the amount of wear they put on the state’s roads,” said Whitty to the AP.

Opinion & Analysis: Privacy and viability issues with the mileage tax

Many critics of the Vehicle Miles Traveled program argue that tracking drivers with GPS devices constitutes an invasion of privacy. “It’s outrageous, it’s kind of Orwellian, Big Brotherish,” said Massachusetts state Sen. Scott Brown to the AP. “You’d need a whole new department of cronies just to keep track of it.”
The GPS would not be used to track a driver’s exact movement—only to calculate the number of miles driven. But Jason Williams, executive director of the Taxpayer Association of Oregon, told the Los Angeles Times, “The fact that they tag your car to a certain place at a certain time means they’re tracking your movements. So what happens in a divorce court when the wife tries to track where her husband was, or a boss tries to make sure you were where you were supposed to be?”

Many have found other flaws in the mileage tax plan. Ken Niezgoda of the Oregon Biz Report points out that Oregon residents will pay a greater share for transportation repairs than out-of-state drivers who inflict the same wear and tear on Oregon roads. Under the mileage tax plan, out-of-state drivers will pay the common gas tax when they are in Oregon.

“As more fuel efficient cars become the standard, out-of-state drivers will pay less tax proportionately,” he writes. “In turn, Oregon drivers will be burdened with more taxes in order to maintain the transportation infrastructure.”

The Oregonian’s Rick Attig finds several inequities in the mileage tax plan, such as that “not all driving creates the same problems and all vehicles do not impose the same wear and tear on the highway system.” However, he believes that it could become a viable alternative to the gas tax.

“The gas tax is a dying model—it simply isn’t going to power Oregon’s transportation program far into the future,” he writes. “It’s time for something else, and the mileage tax seems the best of the available alternatives.”

Reference: The Oregon Road User Fee Task Force

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