ANNAPOLIS – After feeling the heat from last year’s gas tax hike, some Marylanders fear another tax increase — this time a fee based on how many miles they drive.
The legislation, which would tax motorists for every mile they drive, was considered by the Maryland Department of Transportation earlier this year.
While it was not implemented, it has also has not been ruled out as an option in the future with the state looking to generate more revenue to cover transportation projects, said Erin Henson, public affairs director for MDOT.
“It’s not something we currently see as a viable option...but never say never,” she said.
The average American drives somewhere between 10,000 and 12,000 miles every year, and more than 90 percent of Maryland drivers are commuters, according to U.S. Census data.
A vehicle miles traveled tax would implement a flat tax per mile driven, and as it was considered by MDOT would be tacked on to the existing gas tax.
Oregon started an annual pilot program in 2006 where volunteers participate in the program for one year. The state places a GPS in participants’ vehicles to monitor how many miles they have driven. The participants pay the tax at the gas pump, but they were exempt from the state’s fuel tax. According to the Oregon Department of Transportation volunteers pay a 1.5 cent charge per mile driven.
Fourteen states, including Oregon, have tried a pilot program.
The potential cost of a vehicle miles traveled tax in Maryland has some people fighting to get it banned before it is ever implemented.
“This type of tax would have a big negative impact on small businesses,” said Jessica Cooper, director of the Maryland arm of the National Federation of Independent Business. “A lot of small businesses are delivery businesses or use vehicles to provide their services.”
A tax would cause small businesses to put the burden of the cost on consumers which would harm the economy, Cooper said.
“This type of a tax would essentially tax people for leaving their homes,” she said. “You are taxing people who move from their homes, which means fewer people are going to be going out to eat or going shopping. The ripple effects could be really damaging.”
In February, Del. Justin Ready (R-5A) introduced a bill which would have prohibited any vehicle miles traveled taxes from being passed, but it failed.
Ready said the tax is regressive because it would have an unfair affect on working-class families and workers while not drastically affecting people with higher incomes, he said.
“Marylanders are overtaxed already,” Ready said. “Funds are not being used to help commuters, but to hurt them.”
Opponents have also raised privacy concerns because the Department of Transportation could require government-mandated GPS devices to track the number of miles motorists are traveling.
Cooper said the idea is “crazy.”
“It’s really troubling to consider the government tracking where you drive and where you go,” Ready said. “So I tried to preempt it.”
Although his bill failed to pass Ready said he is prepared to introduce legislation as many times at it takes to get prevent the tax from happening.
“We need to stand firmly against any mandatory tracking for taxation purposes,” Ready said.