New Michigan study highlights benefits of mileage tax instead of gas tax

MIDLAND, Mich. — New research suggests potential benefits of charging per-mile taxes rather than charging gas taxes.

The Mackinac Center for Public Policy says the state funding system could be improved if lawmakers adopted a “user-fee system” that charges motorists based on miles driven, not gallons paid at the pump.

The nonprofit says residents would be charged for mileage the same way they would be charged for utility payments.

Studies also show that tax revenues decline over time despite increases in gasoline taxes.

The research institute goes on to say that greater fuel efficiency would lead to a gasoline tax revenue shortfall of $1 billion per year by 2050.

“It’s important to ‘sustain’ revenue from Michigan’s highways, making them independent of vehicle propulsion sources,” says Reason Foundation Transportation Policy Director Robert Poole, co-author of the study. . “About a dozen other states have run pilot projects to test mileage charges, and they’ve learned a lot about what works and what doesn’t. Michigan can benefit from their experience by implementing a pilot mileage fee in the near future. »

We are told that charging motorists per kilometer would solve a handful of other loopholes caused by the gas tax.

Read the Mackinac Center for Public Policy report here.

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