Minnesota considers new tax based on mileage driven

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scottm
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Minnesota considers new tax based on mileage driven

Post by scottm » Thu Apr 25, 2019 7:49 am

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Minnesota considers new tax based on mileage driven
https://www.thecarconnection.com/news/1 ... age-driven
Minnesota will mull a different way to tax drivers in the state over a potential increase to the gas tax: a mileage tax.

According to a report from Alpha News last week, Democratic Rep. Raymond Dehn has proposed a tax based on the miles an individual drives. His new piece of legislation would authorize a study that the Minnesota Department of Transportation would conduct on how to phase a mileage tax into the current tax system.

The proposal is different from a more standard call from Governor Tim Walz. The governor proposed a 70 percent gas tax increase, which equates to an extra 20 cents per gallon pumped. Per the report, the increased taxes come as the state entered 2019 with a $4 billion budget surplus.

Where Rep. Dehn's legislation could face backlash is the way the study would collect data to calculate miles driven. The representative said a GPS transponder would be plugged into a vehicle and communicate with a smartphone application. The state government would receive the mileage data and nothing else, Rep. Dehn said. That surely won't stop privacy advocates from crying foul over the intrusion.

The bill was last sent to the Transportation Finance and Policy Division and will still need to hurdle committees and mark-ups before a vote will be held on the matter.
Aside from the govt tracking everywhere you go via GPS, I have an issue with this strategy. Using a "mileage tax" instead of a "fuel tax" sends the wrong message. If you tax fuel, this gives people incentive to own more fuel efficient vehicles. They may have a desire to minimize the amount of tax they pay, and hasn't fuel efficiency always the goal? Although I have heard with more efficient vehicles they may not be collecting as much tax revenues as they really want. I guess that's the unintended consequence. In the end, govts will probably just tax you on both.
Scott Moseman
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