On March 17, 2021, the American Transportation Research Institute a new report. It deals with the costs of deploying and operating a national vehicle mile traveled (VMT) tax. Earlier in 2020, ATRI’s Research Advisory Committee identified this research as a top priority.
The research was done in two stages. First, the ATRI learned the technical and administrative requirements of charging every U.S. driver for miles driven to determine a federal system’s opportunities and problems. Second, the researchers calculated the expenses of operating a VMT tax program related to technologies, data transmission, and account management.
Thus, the American Transportation Research Institute researchers found that replacing the federal fuel tax with a VMT tax could be costly. The tax is levied on 272 million private vehicles, resulting in more than $ 20 billion in revenue a year. That’s 300 times the federal fuel tax. The displacement of collection points is the main reason for such high costs.
James Burg Trucking Company President and CEO Jim Burg noted that National Vehicle Miles Traveled Tax is a more complex and costly replacement for the federal fuel tax than many expected. It takes years of thoughtful planning and federal leadership for such a system to work for everyone.
The report also noted that the equipment at the initial stage would cost $ 13.6 billion per year. Telecommunications costs $ 13 billion, and account administration $ 4.3 billion. In addition to these costs, credit card transactions for electronic payments and equipment shipping costs can reach over $ 1 billion.
ATA President and CEO Chris Spear said that politicians are preparing to present a vision for the future of American infrastructure, so this report could not be more critical. According to many experts, the new VMT is part of the future. And according to the report, implementing this system requires sound leadership, stakeholder engagement, and a clear plan to phase out current funding streams.