Yesterday Senator Jeff Howe (R-Rockville) presented a bill that would increase Electric Vehicle (EV) and plug-in hybrid surcharges. This legislation seeks to make the EV surcharge the same equivalent as the current gas tax.
“This is a good way to start ensuring that everyone driving on our roads pays their fair share regardless of what vehicle they choose to buy,” said Senator Jeff Howe (R-Rockville). “Funds from the gas tax cover repairs for wear and tear on our roads. As our current law stands, when someone buys an electric vehicle, they’re circumventing an average of $229 of gas tax fees per year. We all use these roads, so we should all be paying for their maintenance.”
If enacted, this bill would increase the surcharge for electric vehicles from $75 to $229, would add a surcharge of $114.5 for plug-in EV’s, and would tie both surcharges to the State gas tax. If at any point the Minnesota gas tax goes up or down, these fees would fluctuate in tandem with the changes. Plug-in hybrid car owners have also previously been exempt from gas tax fees, even though owners can use up to 100 percent gas or electric depending on the driving done with the car. Currently, non-EV drivers pay an average of $229 per year towards the State gas tax.
“All of our citizens should be contributing funds to our roads and bridges,” continued Senator Howe. “Gas taxes run the risk of being regressive, but if EV owners contribute to this fund like every other car owner already does, we can avoid that situation altogether. Electric vehicles are heavier than their gas counterparts, and as long as they’re benefiting from state roads, they should be paying to maintain them, too.”
As amended, this bill would also ensure that EV motorcycles pay their fair share. Under current law, EV motorcycle owners pay a $75 surcharge. This bill would alter that fee to $46 for EV motorcycles, and add a $23 surcharge for plug-in hybrid EV motorcycles.
This bill received its first hearing in the Transportation Finance and Policy Committee and now heads to the Committee on Taxes.