A Premature Obit for LaHood’s VMT Tax Plan?
Transportation Secretary Ray LaHood looked a little out of his element last week, when he proposed a vehicle miles traveled (VMT) tax on motorists as an alternative to a higher gas tax on Thursday, only to have it shot down in short order. Transportation Department spokeswoman Lori Irving dismissed the notion the next day, stating flatly, “The policy of taxing motorists based on how many miles they have traveled is not and will not be Obama administration policy.” A few hours later, Gibbs confirmed at a press briefing that “it is not and will not be the policy of the Obama administration.”
Case closed. Breathe a sigh of relief that fuel efficiency won’t lose its incentives. Or maybe not.
An editorial in The Washington Post this morning, titled “Mr. LaHood’s Good Idea,” praised a VMT tax as “the most promising, fairest, most environmentally responsible replacement for the gas tax.” The argument is that drivers will use increasingly little gas as alternative fuels take hold and vehicles become more efficient. As a result, revenues will decline, and funding for road and bridge repairs will collapse. A VMT tax would be a sustainable source of revenue for the long term.
Also this morning, several industy leaders, including the president and CEO of AAA, came out in favor of the plan. I’ll stay on top of this story and have some more analysis soon. But in the meantime, it looks like it could be premature to dismiss LaHood’s proposal as pure speculation.