Texas Governor Greg Abbott has put his signature on a new bill that will require the drivers of electric vehicles to pay a $200 annual fee to renew their vehicles’ registration. The new rules come into effect on September 1.
On top of the $200-per-year renewal fee, Texans will have to an initial $400 when they register a new vehicle. The new tax applies only to vehicles that are powered entirely by electricity, and will not be levied on hybrids or plug-in hybrids.
The owners of those vehicles will have to continue paying the $0.20-per-gallon tax on gasoline, proceeds of which go to funding Texas’ roads. The money raised by the new EV registration fee will go to the same causes.
“This is extremely important to make sure people are paying their fair share and that we have adequate funding for the preservation and maintenance of our highways in the future,” said state House Rep. Terry Canales, according to The Dallas Morning News.
Read: Washington State’s Radical Per-Mile Fee Proposal To Replace Gas Tax And Account For EVs
With more than 200,000 electric vehicles on the road in Texas, and 30,000 added this year, the new fee is expected to raise at least $38 million this year. That money would have been missed by the state without an alternative to the gas tax.
That figure pales in comparison to the $3.8 billion in revenue that Texas is expected to raise through the gas tax in 2024. However, the burden on individual EV drivers is higher. According to data from the EPA and the Federal Highway Administration, Texans with gas-powered vehicles pay an average of around $130 per year in state gas taxes.
While few EV advocates took issue with the idea of an annual registration fee for EVs when this bill was being proposed, critics claimed that the amount was too high.
“If there’s a $200 fee, the driver of a Nissan LEAF, which is efficient, might be paying as much as a driver of a gas-powered Hummer, which is ridiculous,” said Luke Metzger, the executive director of Environment Texas, in April. “Really, the driver of a Nissan LEAF is providing great benefits to the state of Texas in terms of cleaner air, and has much less impact on the road than a Hummer. But they’d be paying the same fee.”
Despite those concerns, legislators were happy with the figure, and the Texas House approved the bill 145-0 last month. Now that it has been signed by the governor, it is official policy for the state.
