Why Raise the Cigarette Tax When You Can Just Tax Breathing?
So goes the logic (with only mild exaggeration) of one of the most ridiculous policy proposals I've read in a while -- to make up for falling gas tax revenues with a new tax on miles driven. Ashley Halsey III is on the case in The Washington Post yesterday.
The appropriate tax instrument to make up for declining or inadequate gas tax revenues is ... a higher gas tax rate. Compared to a higher gas tax rate, a tax on miles driven ignores the amount of fuel used to drive those miles. Highway travel is taxed the same as city travel. Gas guzzlers are taxed the same as hybrids. Neither change makes any sense from an environmental perspective. Nor is it necessary to raise issues of privacy involved in collecting a tax on miles driven in the ways suggested in the article by monitoring the history of the locations of the car (as opposed to an annual fee based on an odometer reading collected at a state inspection).
Many cities are experimenting with congestion taxes, which are based on miles driven at particular times in particular locations. Those are worthwhile policy measures to relieve congestion and are different from a uniform tax on miles driven.