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An Anonymous Coward writes in with an article from Vice.com.
A generous state tax break has helped make Georgia the number two state for electric vehicles, and made Atlanta the top market for the compact Nissan Leaf. Both the Leaf and the higher-end Tesla sedans are now common sights in and around metro Atlanta, where more than 10,500 are registered.
But this year, Georgia lawmakers needed to raise nearly $1 billion to patch up crumbling roads, highways, and bridges. So they are pulling the plug on that $5,000 tax credit — a move budget analysts say will contribute $66 million to the state's coffers in 2016 and nearly $190 million by 2020.
But it gets worse for electric vehicle (EV) boosters. Legislators are adding a $200-a-year annual fee for owners to offset the loss of gasoline taxes that drivers would otherwise pay to maintain roads.
The Economist has a breakdown of the current system of the tax credits and the expected economic impact of the changes.
(Score: 4, Insightful) by moo kuh on Saturday April 04 2015, @09:07AM
I doubt this is only about infrastructure maintenance. According to http://en.wikipedia.org/wiki/Electric_car_use_by_country, [wikipedia.org] EVs have less than 1% of the market share. Maybe a civil engineer can correct me if I am wrong, but isn't most wear done by large trucks with heavy loads? Everyone uses roads whether they drive or not. Stuff has to get to stores somewhere, and people have to get around in some manner. Wouldn't it make more sense to raise some other kind of tax since good infrastructure benefits all? The fee I can understand. I am not an economist, but assuming EVs have a lower total cost of ownership over the long term than a comparable ICE, wouldn't that money be spent on other things? Sure, ICE mechanics would suffer a bit, but that is the broken window fallacy. I also wonder if there will be any economic impacts from more money spent on fuel, assuming this drives EV demand down. Oil is a finite resource and prices will go up eventually. Lots of EVs would lessen the economic damage this will cause.
I am sure I will get a reply that raising taxes for everyone isn't good for the next election cycle and pissing off a blue leaning crowd in a red state won't hurt as much as a general tax increase. This may or may not be the case. My take is, it is a way for GA politicians to solve a problem that can't be ignored while trying to be re-elected.
(Score: 3, Interesting) by Non Sequor on Saturday April 04 2015, @11:26AM
Sometimes the ability to convince other people to buy in to your solution is a constraint on the forms your solution can take.
One of the opposing theories to what you laid out might be that tax rates are sticky in that there is resistance to increasing them and there is a tendency to redirect revenue towards other projects rather than lowering them. From that perspective, an imperfect use tax may in some cases be better at dedicating revenue to a variable expense tied to that use than an earmark from general revenue even if the general revenue earmark can be directly adjusted for measured changes in infrastructure cost.
Working from that perspective, when the imperfection in your use tax becomes larger in an unanticipated way, you now have a hole in your budget. The immediate response is to patch it.
Write your congressman. Tell him he sucks.