Will gas taxes go electric? Count on it

What will it cost to drive an electric car?

Two weeks ago, I wrote about fees that are likely to accompany residential charging stations, including purchase and installation costs and mandatory subscriptions for network services.

I didn’t have space to speculate on how governments might intrude. But some readers were quick to suggest our politicians will take advantage of the electronic links to impose taxes, perhaps equivalent to the levies that now account for more than one-third of the cost of gasoline.

Reader Dick Malowney raised the key question: “If the population switches in large measure to electricity off the grid, how long can government survive with ever-reducing road taxes from the lower consumption of gasoline?”

And he answered: “One would expect that creative legislators will have to come up with some way to assign road taxes to the electric costs used for transportation.”

One needn’t suspect: One can be absolutely sure.

It will be years before electric cars constitute a significant portion of the vehicle fleet and, therefore, impact governments’ revenue streams. Even a quick glance at current technologies and future prospects suggests finance departments needn’t fret over battery power.

Ontario collects about $2.3 billion a year from its 14.3-cents-per-litre gas tax. Two cents of that is distributed to municipalities for public transit. The rest flows into the province’s general revenues. (Although improved fuel efficiency will reduce gas tax income, the growing number of cars on the road should compensate for that decline.)

The RAC Foundation, the research and charitable arm of Britain’s equivalent to the Canadian Automobile Association, predicted recently that falling gas tax revenues — along with the need to reduce traffic congestion — would make road tolls inevitable.

Others propose replacing the foregone revenue with taxes based on how far a car is driven.

Both, as I’ve argued in previous columns, are dodgy ideas that generate their own problems.

And from the electric vehicle point of view, road tolls and mileage charges are about as essential as potholes. Charging stations will give any government easy entry to a new source of income, accomplishing the required revenue generation like a charm.

It’s a safe bet that no government will be able to resist a handily small number of charging station networks, each carefully measuring every kilowatt of electricity that goes into every plugged-in car, and transmitting that information to a central computer.

There need be no quibbling over whether the electrons fuelled a car or heated a toaster — the vehicle systems would be completely segregated from other uses. And, to make billing a breeze, each car would have its unique access code and file.

It’s tailor-made for a tax department or, for that matter, any utility company. Slap on an electric transportation levy or some other surcharge and, as the number of plug-in vehicles grows, watch the trickle of pennies per kilowatt-hour swell into a torrent of dollars.

Those who opt to avoid charging stations by plugging their cars into a regular outlet at home might make it difficult for the taxman to separate electricity consumption for a vehicle from other uses. But it appears safety codes will require independent wires and breakers for plug-ins, and it would be a short step from that to some sort of measuring device.

And the future seems certain to offer gizmos such as wireless chargers — electromagnets embedded in the floor that eliminate the need to plug in — seemingly designed for easy data collection.

There’s nothing evil in this. But we can expect that fuel taxes will be seamlessly replaced by electron levies. Consider it certain.

peter.gorrie@sympatico.ca

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