Identical bills in the Texas State Senate and its House of Representatives, are working out a way to recoup the tax dollars that the state will lose from EV drivers who do not need to buy gasoline.
Like other states, Texas funds a significant amount of its roadworks with money raised through a gasoline excise tax, leaving legislators to figure out how to pay for roads as vehicles depending on fossil fuels will inevitably start to decrease.
State officials are now looking at a $200 annual registration fee for EV owners, reports the Houston Chronicle. While the bills’ architects argue that the levy would simply be replacing a tax that already exists, some critics are wary about the figure.
The amount that Texas raises with the gasoline excise tax varies widely. Even in the case of two drivers who go 15,000 miles (24,140 km) in a year, the total will change depending on their vehicle. For the driver of a big SUV that gets 15 MPG, they will pay about $200 per year. Drivers of smaller, more efficient vehicles that get 35 MPG only pay $85, though.
Read: Washington State’s Radical Per-Mile Fee Proposal To Replace Gas Tax And Account For EVs
Although Cyrus Reed, the conservation director for the Lone Star Chapter of the Sierra Club, agrees that EV drivers should be charged a fee, he argues that $100 is a fairer amount. Indeed, that’s the amount that California, the state with the most EV drivers in the country, charges. Neighboring Arkansas charges $200 per year, though.
Some EV supporters think that finding a new way to fund Texas roads would be a better way forward. Meanwhile, some researchers and states, including Washington, are considering introducing an annual fee based on mileage.
While that would be a more fair charge for EV drivers, it introduces privacy concerns. Finding a way to track mileage that doesn’t also reveal a lot about drivers’ behavior is a difficult challenge.
Just the latest attempt Texas has made to introduce an EV registration fee, the Legislative Budget Board estimates that the state has lost $93.4 million in revenue from EV drivers who currently do not contribute to the state’s roads budget since the topic was last raised in 2021.
For now, that’s a relatively minuscule sum. In 2022 alone, the state raised $3.78 billion, meaning that the lost revenue from EVs amounts to around 1.2 percent of the total per year. As American efforts to make EVs more popular succeed, and their increasing weight taxes roads, the question of how to fund repairing them has to be answered.
