ATA argues against vehicle miles traveled tax

user-gravatar Headshot

The American Trucking Associations today, Feb. 26, says it commends the National Surface Transportation Infrastructure Financing Commission for its thorough accounting of the funding challenges facing the nation’s surface transportation systems. The situation the commission describes requires dramatic and immediate steps to address the deficiencies of the nation’s highway infrastructure, ATA says.

ATA agrees with the commission’s recommendation on the need for an adjustment in the federal fuel tax, provided more of those revenues are focused on programs to improve goods movement. Additionally, ATA believes that all highway users must contribute equitably for their use; strategic highway investments will benefit all highway users, and one sector should not be asked to bear an unfair burden, particularly during these difficult economic times.

ATA believes that future changes in vehicle technologies will reduce fuel use significantly and jeopardize the future use of the fuel tax as the primary means of financing highway improvements. The commission’s solution – to migrate to a vehicle miles traveled (VMT) tax – currently presents privacy concerns that not only are intrusive, but also could lead to new forms of fraud and identity theft, ATA argues.

The costs to implement and maintain the program also reduce the amount of funds that are directed towards infrastructure, ATA says; the proposed VMT tax system also eliminates consumer incentive to use less fuel, a necessary component in helping to lower the cost of fuel, reduce carbon output and improve the nation’s balance of trade. All of these issues must be addressed before considering a VMT tax as a viable long-term solution, ATA says.

“The federal fuel tax has worked well for more than 50 years with the lowest collection and evasion costs,” says ATA President Bill Graves. “There is no reason to transition to a new funding source within the 10-year timeframe suggested by the commission, and certainly not to an alternative with as many problems as a VMT tax.”

ATA agrees that the highway investment shortfall must be addressed; however, the fuel tax is a cost-effective source of highway funding, and it should not be abandoned. ATA believes the tax must be adjusted to meet current needs, and Congress should do a better job of prioritizing how federal funds are invested.