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A new mileage tax may replace the gas tax in Oregon. Oregon residents will be taxed by the number of miles travelled, as they travel along the state's highways like Highway 30 pictured here. Those not participating will face higher taxes at the pump.  (Source: Lyn Topinka)
A new ambitious high-tech effort to fairly distribute roadwork taxes proposed in Oregon, but can it overcome fears of government tracking?

Nobody likes to pay taxes, but they are reality of modern U.S. government as we know it.  However, if you have to pay taxes, you at least want them to be fair.  That's the mentality driving a rather revolutionary, albeit controversial, new plan in the state of Oregon.

In Oregon, as in other states, people have long complained about using fuel taxes to finance road work.  Such measures place a larger tax burden on those in professions requiring heavier vehicles.  So Oregon's Gov. Ted Kulongoski (D) has developed a new plan -- pay by mileage.

Oregon, whose highways recently gained attention via a new solar project, is now looking to legislate the governor's plan.  The new legislation will provide Oregon with "a path to transition away from the gas tax as the central funding source for transportation" via a mileage tax implemented with the help of GPS satellites.

While the exact details are still being ironed out, Gov. Kulongoski's web page gives the basics of the plan.  In it he states, "As Oregonians drive less and demand more fuel-efficient vehicles, it is increasingly important that the state find a new way, other than the gas tax, to finance our transportation system."

He is creating a task force "to partner with auto manufacturers to refine technology that would enable Oregonians to pay for the transportation system based on how many miles they drive."  Key studies were performed in 2006 and 2007 that indicate that such a program would indeed be possible. 

In the 2007 test which lasted 10 months with 300 motorists at two service stations, drivers were taxed 1.2 cents per mile and were refunded the 24 cents a gallon state gas tax.  When the motorists got to the pump, their vehicles connected to government computers informing them of the mileage (calculated via GPS tracking) and issuing tax.  Equipment for the test came from Oregon State University.

While clever, the program faces one enormous thorny obstacle -- concerns over the loss of privacy. 

The governor's online outline states, "The governor is committed to ensuring that rural Oregon is not adversely affected and that privacy concerns are addressed."

Despite assurances from James Whitty, the ODOT official in charge of the project, that the new GPS system would not be used for continuous tracking of citizens' cars, many advocacy groups are outraged and many remain fearful.  The final report on the 2007 test deployment was conscious of this fear, stating, "The concept requires no transmission of vehicle travel locations, either in real time or of travel history.  Accordingly, no travel location points are stored within the vehicle or transmitted elsewhere. Thus there can be no ‘tracking’ of vehicle movements."

Advocates point out that the devices are not developed by Oregon, but rather by industry partners.  The program's policy page states, "ODOT would have no involvement in developing the on-vehicle devices, installing them in vehicles, maintaining them or having any other access to them except, perhaps, in situations involving tampering or similar fee evasion activities."

However, even if privacy concerns can be laid to rest, there will also be a large price tag associated with initially implementing the program, one which may give residents sticker shock.  An initial investment of $20M USD would be needed, according to the governor, just to see if the program was viable.  A full deployment would require GPS be gradually added to gas stations and to all vehicles in the state.

The proposal also calls for a punitive tax against those not adopting the new device -- the gas tax will continue for vehicles not equipped to pay the mileage tax, but it will be increased 2 cents.



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why?
By acejj26 on 12/31/2008 11:27:10 AM , Rating: 2
If the libs in Oregon are going to go through with this, there is a far less technical approach to this. Every year, require an inspection of each car and look at the odometer. Subtract the previous year's mileage from the current one and you see how many miles were driven. Voila.

That being said, this idea is pretty much retarded. How long before they put weight sensors in your car to see how much impact you have on the roads (if you carry more people, your car is heavier and you need to pay more for road maintenance)? Maybe later they will use the GPS capabilities to see if you did more city driving than highway driving and tax you even more because most cars get less MPG in the city.

Honestly, the current gas tax is already a tax on how much you drive. Leave it at that.




RE: why?
By theapparition on 12/31/2008 11:40:50 AM , Rating: 2
Exactly what I was going to suggest. Requiring an expensive system to monitor cars is ridiculous. Just have each years odometer reported with registration/inspection.

Just another money grab.


RE: why?
By afkrotch on 12/31/2008 12:02:22 PM , Rating: 2
Unless the odometer is broke. A broken odometer does not cause a car to fail inspection. It's not a safety issue or anything of the sort. Would piss me off if they forced me to fix crap that doesn't need to work. Like telling me to fix a hole in one of the seats.


RE: why?
By theapparition on 12/31/2008 12:11:53 PM , Rating: 2
Most states have laws that require working odometers, if not all.
A odometer IS a required item, not frivalous as you suggest. Imagine buying a car with only 3,000 miles, only to find out is has 73,000. How about warranties that expire at a certain mileage.
Tampering with the odometer is FRAUD. And all states have laws against fraud.


RE: why?
By mdogs444 on 12/31/2008 12:40:21 PM , Rating: 2
That could not work in the slightest either - as the method of subtracting last years usage, as well as the GPS solution both charge you for a major item that you shouldn't be charged for.

Lets look at some examples here. Say you have a long drive way, or you live on a farm and use your truck to drive all over your own land. What about if you live in a condominium or apartment or private drive subdivision? Those roads are private and paid for by your yearly/monthly assessment fees. But you'll still be charge mileage for driving on them?

This whole thing is stupid. Just another way to tax the people, instead of the state/local governments learning to cut back on spending and conserve, just like the regular people need to do when they have a money shortage. We don't get to go to work and demand a pay increase because we cannot manage our own finances appropriately.

Tax & Spend liberals...this is what they are all about.


RE: why?
By FITCamaro on 12/31/2008 12:47:54 PM , Rating: 2
Good point on private roads. Didn't think about that. If they're gonna do it was just thinking the odometer would be easier. It being based off GPS is still going to tax them on private roads though.

Honestly I'm not sure what to make of an idea of taxing based on mileage instead of a flat gas tax. On one side gas is cheaper. But then you've got another tax to pay separately. If they equal out the same, I guess the question is whats the point. But the fact that they're looking at this, they think they'll make more money off it.

And we hardly need to give government's more money to waste.


RE: why?
By Reclaimer77 on 12/31/2008 1:01:46 PM , Rating: 2
This idea is insanity incarnated. When are people going to take a stand ?

The people of Oregon should burn their state to the GROUND before something like this is even considered !


RE: why?
By ZmaxDP on 12/31/2008 1:18:46 PM , Rating: 4
Yeah! Scorched Earth!

Actually, they would probably use gasoline to start/fuel the fire. So, technically, they should wait till after the law is passed as their arson will be approximately 24 or 26 cents cheaper per gallon. They aren't driving with it, so they won't pay taxes on it at all!


RE: why?
By MadMan007 on 12/31/2008 6:49:31 PM , Rating: 2
Tax & Spend liberal or Deficit & Spend Neocon. They both suck.


RE: why?
By Varun on 12/31/2008 1:37:57 PM , Rating: 2
That won't work because you should not be charged state tax when driving out of state. If you take your family on vacation to Nevada, your OD would show that and in your scenario you would then be taxed state road tax for roads in Nevada.

Plus you are adding in a yearly inspection which will cost people time (which they will hate) and will force the state to hire people to actually do the inspections, have a building, etc. That is going to add up quick.

What they need to do is have an automated system where if you buy more gas in the state, then it is likely you drove on state roads, and therefore you get taxed more. Oh wait! They have that now!

Honestly this is one of the dumbest taxes I have ever heard of. The only fair tax is income tax. Just cut all the others and use income tax if you are worried about being unfair.


RE: why?
By ZmaxDP on 12/31/2008 1:55:54 PM , Rating: 2
Please correct: "The only fair tax is income tax."

Should be: "The only fair tax is no tax."

Income tax as it now stands is certainly not "fair" as I see it. I think a flat income tax would come close to being "fair", though I don't think it is completely "fair".

I could make an argument that sales tax is more "fair" than any income tax if I wanted, though once again the current system would need major revision to be truly "fair".

To me, fair means equal taxation, or just taxation. Still there are issues, is a head count tax equal? Technically, yes. Everyone pays 100 dollars a year. Done. Do I think that is fair? No. Everyone pays 10% of their income seems equal, just, and fair to me; but I can't claim to have researched it fully enough to say for sure (in my opinion).

We also need to ask the question, do we even want a "fair" tax? (Not to mention the oh so semantic - define "fair".) A "fair" tax taxes criminals the same as innocents, taxes rich the same as poor, taxes sick the same as healthy, etc...

Is it "fair" to use sales tax to tax a homeless, unemployed man when he buys cigarettes? What if he's buying a coat? Or Milk? Is it "fair" then? Maybe it is to me, but it may not be to you.

No tax scheme is truly fair as they all favor someone or some situation. There is bias in everything. Throw in the challenge of public opinion which seems to favor over-taxing the rich and under-taxing the poor on income taxes, and you've got the opinion problem too. The best tax isn't a fair one, it is the least unfair one to the most people.

(Not the most advantageous one for the most people which is what we've got now! This is why lower income tax percentages for the poor is a problem. They don't pay much in income taxes, but receive a lot of the services it pays for. So it is easy for them to say raise taxes for more services, they don't pay for them anyway. If those services were coming equally out of their paychecks, they'd be either more restrained in calls to raise taxes or much harder to ignore because they would be paying for them too.)


RE: why?
By William Gaatjes on 1/1/2009 2:53:37 PM , Rating: 2
As a side note :
In my country and europe in general , we have to bring our cars in every year for inspection at a licensed dealer or garage. This to improve the safety, durability and enviromental issues (is in a sense also safety, you do not want to breathe carbonmonoxide) of the vehicles. Depending on fuel type, vehicle type and release to the road date this has to be done after the third or fourt year. And from then on every year. The odometer is also noted every inspection as part of the build up of a history of the vehicle. I assume this yearly checkup is done also the states, then keeping track of milage is not really an issue. Not a garantuee that fraud cannot be commited but in general it works pretty good.


RE: why?
By William Gaatjes on 1/1/2009 2:54:45 PM , Rating: 2
But this gps based tax is still nonsense i forgot to add.


"So if you want to save the planet, feel free to drive your Hummer. Just avoid the drive thru line at McDonalds." -- Michael Asher

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