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Electric-car state fees often cost more than gas tax, study shows

Roadshow logo Roadshow 9/11/2019 Sean Szymkowski
a car parked on a sandy beach: Governments want EV owners to still pay their fair share, but perhaps the process is a tad upside down. Frederic J. Brown/Getty Images© Provided by CBS Interactive Inc. Governments want EV owners to still pay their fair share, but perhaps the process is a tad upside down. Frederic J. Brown/Getty Images

It's perhaps an unthought-of benefit for electric-car owners: There's no way to pay into a state's gasoline tax at the pump since the cars won't take a drop of fossil fuels. Numerous states have crafted workarounds, however, as they try recoup costs to keep road budgets afloat for repairs and maintenance.

The problem is, the electric-car fees often cost far more than what the owner of a traditional car pays in gas tax. That's the grand takeaway from the latest Consumer Reports study, which looked at EV fees in the 26 states that impose them. The research, by and large, shows EV owners pay, or will pay with proposed fees, more than the standard gas tax.

For states that already impose fees, Arkansas, Colorado, Mississippi and Alabama charge the most. The study showed each state's fees are 198%, 197%, 158% and 127% more than the gas tax, respectively. For an EV owner in Arkansas, they'll need to cough up $200 annually to operate an electric vehicle on local roads, for example.

a close up of a map: Does your state charge an arm and a leg to drive electric? Consumer Reports© Provided by CBS Interactive Inc. Does your state charge an arm and a leg to drive electric? Consumer Reports

The lowest current fee is Virginia at 5% more than the gas tax. In the future, more states plan to ratchet up the fees, with parts of Missouri planning to charge 314% more than the gas tax for EV owners. Texas and Arizona also plan to enact fees that cost 212% and 275% more than the gas tax.

Research

The study found many state government argue electric cars damage infrastructure and roads more, due to their greater weights. However, Robert Atkinson, an economist at the Information Technology and Innovation Foundation, downplayed the argument. He countered that damage from SUVs, light-duty trucks and sedans is minimal, and if states were truly interested in making up infrastructure damage costs, the tax should be on heavy-duty trucks.

Instead of higher fees, Atkinson said the fee should be lower than a gas tax equivalent since the vehicles do not produce emissions, and therefore, give local government fewer pollution problems.

The irony of the fees is how little they're expected to contribute to state highway funding, since there are so few electric cars on the road. On average, the fees will account for 0.04% of a state's road budget. In fact, where fees are lower, states make more revenue, because of greater EV adoption.

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