By negotiating the bipartisan infrastructure bill, Republican Sens. Susan collins and Rob portman argue that electric vehicles should be taxed equivalent to what other vehicles pay to maintain the infrastructure on which we run. As Collins Put the, electric vehicle drivers are “literally stowaways because they pay no gasoline tax”. Democrats should realize that these Republicans are right.
But are they? Indeed, four arguments oppose their tax. The use of electric vehicles fights climate change. As temperatures repeatedly break records, this “Ford-F150 tax,” as White House press secretary Jen Psaki cleverly spelled it out, looks like a madman-engineered deterrent. Second, why attack an infant industry?
But when Republicans go out of their way to propose higher taxes – on American manufacturing, no less – Democrats should check their own political blind spots. Collins is not predatory but prescient. Electric vehicles can have a 3 percent market share today, but they are the future. When auto giants like Ford and General Motors invest billions in the manufacture of electric vehicles and commit to ditching the very vehicles that have generated their profits for more than a century, the transition will not be slowed down by a usage tax.
Senator Bernie Sanders objects that a tax on electric vehicles is regressive. But today it would be a wealth tax because EV owners are, for the most part, wealthier. Part of the reason is that EVs are so new that the second-hand market is tiny, and because some manufacturers initially build more expensive models to capture the larger profits that well-heeled customers will pay. . While this is a side effect Collins surely did not anticipate, those who favor the distribution of wealth should defend his proposal. We could even settle his complaint: electric vehicle owners are wealthy free riders.
Still, as the adoption of electric vehicles spreads, Sanders could possibly be right: an electric vehicle tax could become regressive. But he could applaud it; the Scandinavian countries he touts as models all have gasoline taxes. If Sanders wants to revive “our revolution”, as he calls his mission, he could advocate for a higher tax on luxury models. While today’s gasoline tax is flat, an electric vehicle tax doesn’t have to be regressive.
In addition, there is an urgent need to adopt a version of the Collins-Portman tax proposal. Many people are hoping that electric vehicles will completely replace their fossil fuel-starving parents. But these gourmets contribute a little $ 36 billion to the financing of infrastructure each year. As gasoline-powered vehicles are phased out, the taxation of electric vehicles will become an increasingly vital source of funding. To oppose a tax on electric vehicles is to involuntarily plead for the financing of infrastructure. It is a position that all Democrats and most Republicans oppose.
Senator Collins wants to reduce the charging network in the infrastructure bill, to suggest instead we finance electric buses. When a Republican senator advocates spending on public transportation, I sense a bipartisan agreement.
And yet, while an electric vehicle tax won’t discourage adoption, hurt industry, and doesn’t have to be regressive, a fourth objection remains. President Biden has pledged not to raise taxes for anyone earning less than $ 400,000 a year, and he believes the proposal of the Republican senators breaks its promise. But red lines attract trouble.
Biden needs to avoid ridiculing the proposal as a tax on sin and instead upgrade its syntax. He could defend the Collins-Portman idea by arguing that far from being a tax hike, it just plugs a loophole. Owners of electric vehicles should not escape the costs long assumed to be borne by every driver. Biden can deflect the inevitable attack that he breaks his campaign promise by saying he embraces Republican-initiated funding for the sake of bipartisanship and rebuilding for the better.
Finally, paying taxes creates a commitment. Just as those who pay Social Security taxes demand their benefits, electric vehicle owners will also be demanding. “OK, we’re paying our EV tax, now where’s our charging network?” Where is our smart grid? Where are the solar panels and wind turbines to power our future? A levy replacing the gasoline tax will create rights for owners of electric vehicles of all classes – and do us all a blessing.
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