Pay Per Mile Tax: Innovative Thinking Or Inability To Innovate?
It always amazes me how human ingenuity turns things that only lived in our imaginations into reality. The image above, I took when visiting a computer museum a couple of years ago. It shows the illustration by an artist, H. Miller whose imagination of the electric cars of the future and was printed in 1957 LIFE magazine. It demonstrates that electric vehicles in the future would be autonomous, and passengers could spend their commute on quality time like family games.
If we were back in 1957, we definitely be entertained by the idea and never in our minds would accept this could be possible. Even today it is not easy to picture all autonomous vehicles on the roads, but today electric vehicles and self-driving cars are already a reality. Maybe in its initial stages, nonetheless the reality. Perhaps we can't see the full picture, it is not that difficult to accept that self-driving electric cars are here to stay and grow.
Innovations in computer technologies, electrical engineering, robotics, machine learning, artificial intelligence has been growing exponentially. This makes technologies like autonomous electric vehicles possible and offer solutions for things that we could only imagine before. There has been progress in all disciplines too, civil engineering and architecture didn't stay still either. There are many brilliant minds in these spaces as well. But why does it feel like they have been lagging behind in innovation?
Of course spending precious time while in a car for more productive and quality activities seem great in comparison to staring at the road while trying to get to the destination. What would be better though is not to be stuck in traffic and wasting hours and hours on daily basis. Did they fail in pre-planning when building roads? Did they have wrong estimates of the growth of vehicles on the roads? Did they lack innovation or motivation? What happened?
Maybe it is a lack of motivation to innovate since most road contractions, maintenance, and improvements are under the control of government entities. Maybe it was a corrupt nature of officials who are in charge of granting construction contracts to those who kick back instead of offering better solutions. I can only speculate and offer my thoughts. Perhaps, there are better answers.
One thing is clear that these officials and politicians never fail in thinking creatively and innovating is the taxes. Currently, electric vehicles on the roads only take very small percentage of all vehicles. But politicians are already worried about their revenue that comes from gas taxes. As more and more drivers switch to electric vehicles government will receive less and less money in gas taxes. Their solution is pay per mile tax.
In the state of Washington there are already actions in place to implement pay per mile tax. Some states like Oregon and Utah already have active pay per mile taxes. This practice will probably will extend to other states and countries too. They love their taxes and will use any justification to get them.
The reasoning behind pay per mile tax is that everybody needs to pay their share to maintain the roads. You drive, so pay your share. My question is what do you do with other taxes? For example, if people go to work and have to drive, why do they need to pay per mile when they are already paying income and other payroll taxes. Or what about when people go shopping, they pay sales taxes. Most people need to drive to do any of these activities and already pay decent amount in taxes.
Well, yes originally taxes start out small and one type of tax can pay for everything. But lack of competence or corruption causes these taxes not being enough over time. Then what do you do. You invent other types of taxes. Super innovative minds, no? To be fair, some taxes do go for good use, and I am not completely against them. What I question is lack of transparency and accountability and using taxation as the main source of solution when any challenge future presents.
Vehicles have been getting smarter, electric or otherwise. Pay per mile taxation will open the door for another problem. A problem of privacy. Now that newer cars have better computers and collect all kinds of data, government official will demand vehicle manufacturers to provide access to this data. This request or order will be justified by the need to calculate taxes. However, governments don't have great track record of using data as initially intended. I would expect there would be some controversy around driving data, if and how they should be shared and/or collected.
There can also be a lot of good use for collective data if used without intruding individual privacies. If there are many autonomous vehicle on the roads, these vehicles will operate more effectively and safely if they talk to each other and share data their sensors detect. Also, this may help in detecting rush hours and coming up with better solutions that create less traffic and get the commuters to their destination in reasonable amount time.
Again, I see a need for more transparency and accountability to achieve better outcomes. Traditional ways of doing things are not good with transparency and accountability. What if there was a technology that could offer these features in the most effective and efficient manner? I am talking about blockchain. I think blockchain can provide much needed transparency and help holding officials accountable for their actions on how they spend public funds.
Of course any changes like this shouldn't be considered in vacuum of only increase of electric vehicle adoption. There are other areas like public transportation, parking fees, toll roads that need to be considered as well. This may also include design and architecture of new buildings, roads, and infrastructure.
Sometimes it seems hypocritical to me when there is a massive campaign to encourage people to use electric vehicles instead of those that use diesel or gas. There are incentives given to the manufacturers and buyers to do so. But then they turn around and say well time to tax you. lol. It's ok. Sure, go ahead and tax. Just be reasonable. Problem with any kind of taxes is, once they are in place, the next thing politicians do is keep increasing them.
Another source of income from drivers is collecting fees for public parking. When Covid crisis started, restaurants and businesses got shut down. When slowly started reopening, one of the requirements for restaurants was to only offer pick up or delivery orders. Then they also allowed for eating out in open spaces outdoors. Some restaurants have outdoor properties too. Some don't. What they did was start utilizing parking spaces in front of the restaurants for outdoor dining. Smart idea.
Smart business thinking like this does help businesses in the communities to survive, otherwise the alternative is to go out of business. Going out of business, which already happened for many, is not good for local economies, communities and also means less taxes. Streateries are an open space constructed in the parking lane outside a local business, in other words street eating.
Streateries became common during Covid and continue many businesses continue to use them. Edmonds City officials just recently agreed to start charging these businesses thousands for using this space. Because these parking spaces are public, and city is losing revenue in parking from these spaces they think businesses should pay instead. Clever income generating tactic? I think not.
I think these officials should be thanking businesses for staying open and continue operating in such difficult times. Instead of offering help, these kind of measures of how to get more money from people only serve as obstacles. Let's say these businesses break down their streateries because they don't want to pay these fees. What is the outcome? Who would park there anyway if the business is not operating?
What do you think? Are pay per mile taxes or other kind of fees innovative thinking or inability to innovate? Let me know in the comments.
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The first picture was reminiscent of one of Fleming's novels about secret agent James Bond, which describes the autopilot on a car. Bond turned on the autopilot, and began to write his report.
I remember that this description shocked me. But your picture ... Were the autopilots already in use in the 50s?
I don't know, probably not. Maybe some early ideas and prototypes.
The electric car in some point would be helpful to reduce the use of petrol or gas which results to pollution.
Taxes have always been the "legit" way our government rip off it's citizens. Here in Nigeria (thankfully electric cars aren't common yet) the taxes are plain stupid. When i was working at a liquor store, we sold both liquor and soft drinks. We were taxed for the liquor, the soft drinks and guess what else for? Our signpost!
Where do these people come up with such ideas? Their reason is "it is on government property". Then come a few months later, Some other people came by claiming to be sent by the State government. Lol. Apparently, the previous outrageous amount we paid was to the Local government. The state government came in demanding something more stupid. This is no innovative idea. This is corrupt practice.
If that wasn't enough, we found out that our liquor store was charged 30,000 while a man who owned a cloth store was charged 15,000. And if you want to go by value, that man's store/boutique (two of them) is worth approximately 20Million while ours is just a little over 1Million in value. So I really don't get the logic.
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You bring up a great point. Not only there is unreasonable taxation, but also layers of government entities that all want some of that money. It does make things more frustrating.
People have have a hard time figuring out how to pay for roads since antiquity.
Private roads often charged tolls. The problem is figuring out when, where and how to charge the tolls.
Truck drivers in the US have been paying taxes for road mile driven for quite some time. Truck drivers keep detailed logs of every mile driven in each state along with info on the fuel they purchase.
They then end up filing complex reports that weigh the miles driven against fuel purchased.
The ability to electronically track every mile cars drive might lead to a more equitable system for funding road maintenance. If designed correctly, we might even see privatization of more of the nation's infrastructure.
BTW, the privare railroads in the US charged customers for the use of the rails. A primary reason that people preferred cars to railroads is people felt that they could externalize the cost of the rails onto the cars.
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I have heard that truck drivers have to keep track of their miles and fuel purchases than file taxes based on that. I think it had more to do with how these taxes are split up among states that trucks travel trough.
A lot of these just add unnecessary bureaucracy and adds cots of complying with them for the tax payers.
You are right it is not easy to figure out how to pay for roads. But with decades and centuries of knowledge, it shouldn't be too difficult either.
Big rigs usually have huge tanks; so they can decide when and where to buy fuel.
The mileage taxes paid by truckers are entirely about states wanting drivers to pay for the roads they use as big trucks take a huge toll on local roads.
Having cars do the same thing might actually create a road system which is more responsive to actual use.
BTW, I would not mind seeing insurance combined with a mileage tax. Imagine a system where the taxes increased depending on the risks associated with a given road. This would encourage safer driving and encourage states to build better roads.
I think it's their inability to innovate. Obviously they desire the taxes and nothing should ever drop down their income sources. I don't see how a mileage tax helps anyone and it would only force people to drive less. Maybe they want everyone to move towards using a Uber and etc.
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I love that picture but... dominos!?! He wasn't far seeing enough! 😃
I was thinking of data related issues, if pay pile miles will be fully implemented, I fear that the government will not be able to use people's data judiciously
I constantly feed abused by taxes. Yet I also try to keep in mind, that the government is a service and as any service it has a cost. I agree with VAT, because the government helps regulate the market and I buy things in that safe market. I agree with a tax for driving on a road, I would even agree on a tax(entrance fee) for a public park, because I want those services. And police, and clean streets, etc. All those things cost. And I believe it is fair and required to pay for them. That would be your call on transparency of where do taxes go, and I agree, we need that. But more especially, that we could vote with our taxes. You go more to the park, you pay more, but you also incentivize the government to keep investing on the part. Super capitalist I know, but that is the only way to keep up with the trends and needs of the population, it is a direct feedback.
What I hate, is not being part of the feedback, when the tax is just taken away. I absolutely hate income tax, and I hate more of it that it keeps growing as I make the effort to get a better pay. It really plays against getting better and growing. There shouldn't be like that. It should be VAT like, you develop your skills and experience, you are worth more, you add more value, you charge more and you pay the same fraction. It translates to a larger amount, but it is the same fraction. Your work is a service you provide on a regulated market, it should be VAT not income tax. The government aside from minimum wage is not really regulating my salary, helping it get better. It says, if it gets better your tax increases, instead of fostering grow it fosters getting stuck.
The main reason taxes feel so painful, is because government is inefficient, it is like when you pay for a service of a bad company. In general bad companies go bankrupt, that is a lot harder for governments, because they force you taxes and on top of that control the money. I really look forward that with cryptocurrencies we can move to government shopping. You would subscribe to the governments that offer the services you are willing to take.
Would that destroy the public goods, public spaces? Maybe. But maybe we would get a different competition of public spaces, affordable and really expensive pricing many out, yet not much different than today. There are many places my income prices me out and I cannot visit. Where I would fear a bit more is in this competition if we would get as humans rational enough to protect things. Would enough people pay to protect something like national nature parks, or make Disney theme parks just more abundant? Well Disney does have a lot of nature and a lot of concrete, maybe we could manage to not destroy our planet.
Your thoughts are very well put and I agree with most of them. I am not sure how effective voting with our taxes is though. Government entities don't operate like companies and if they saw some losses, I doubt they would care because it is not really their losses.
100%.
I think pay per mile taxes are problematic in a variety of ways. For one, the government really has no business knowing how many miles I drive. I'm not sure how they plan to determine how many miles you have driven but I can only imagine that besides the privacy implications there would be inconvenience as well.
I think you either will have to report yourself how many miles driven or they will take that data from the vehicle automatically, or both.
Pay per mile? That's rather absurd because other taxes are being paid in one way or the other.
It's not a bad idea but it should be compromised to suit other people.
Electric vehicles are a very great innovation and it would be help of great help in the future and could even help to reduce traffic congestion and pollution.