The Economist's Democracy in America blog published an article yesterday that discusses Oregon's proposed vehicle-miles-travelled (VMT) tax, which is intended to enter a trial phase in 2015. It is an interesting concept, and I was curious how it compares to the current model.

The current gas tax (30 cents/gallon) is added to the price of gas at the pump. The more gas you buy, the more tax you pay. The blog post's author explains that the increasing fuel efficiency of cars has decreased gas tax revenues. This shortfall is bad for drivers because it lowers the amount of funding available for infrastructure maintenance.

Oregon is considering boosting revenues by switching to a VMT tax scheme. Rather than adding thirty cents to the price of a gallon of gas, drivers would pay 1.5 cents per mile driven. The above chart compares the annual gas taxes paid under the VMT model with the taxes paid when filling up cars that get between ten and sixty mpg. Using the VMT model, drivers will pay gas taxes roughly equivalent to those who currently drive cars that get twenty mpg.

I don't live in Oregon and am not familiar with the politics surrounding the proposed VMT plan. In my opinion, it seems like a fair way to recoup tax revenues lost to more efficient vehicles. Efficient cars cause infrastructure wear and tear at roughly the same rate as inefficient ones (although, heavier vehicles do wear roads at a faster rate than lighter ones). I'm not sure how the plan intends to deal with electric vehicles. The blog post does note that the plan has faced controversy over the way that mileage might be monitored (GPS tracking).