Indiana to follow Michigan on fee for not using Gas

Date: 05 JAN 2017posted by Car Rentaledited by WinX

Indiana is looking to follow Michigan's footsteps in implementing a fee for electric car owners for not using gas. The stated goal of this fee is to help pay for road repairs. Michigan is currently in the process of adding fees for electric cars which include hybrids and battery-electric cars since they do not use enough gasoline to generate the same amount of tax revenue as fossil fuel engine vehicles. The same logic and reasoning follows in Indiana where they are proposing an annual fee of $150 for electric cars registered in the state, however the fee will not apply to hybrids. However, these are not the only measures the state is proposing to pay for road repairs. There is also a proposition to increase the gas tax and a registration fee for all vehicles.

The bill's new $15 increase in registration fee will apply to all vehicles including the electric vehicles already getting taxed with the $150 fee. Unlike the muddy situation in Michigan in which the language used implied hybrid vehicles were excluded in the fee but the owners have been taxed with new fee. The current Indiana gas tax is sitting at $0.18 per gallon, and the proposed increase will be an additional 10 cents to $0.28 per gallon. Based on the legislators' assumption that the average Indiana driver covers 12,000 per year, the owner of a vehicle achieving 25 miles per gallon combined would pay a yearly sum of $134.40 per year with the gas increase. The owner a hybrid which would achieve 50 miles per gallon would pay half of that sum at $67.20 annually. Hypothetically, the owner of an electric car would paying more towards road repairs than a traditional combustion engine vehicle and the hybrids.

The bill was introduced by the House Republicans who believe these measures would generate an additional $2 million in revenue per year. The stated of Michigan and Indiana are not the only states that will be travelling upon this path. The need to recover lost gas-tax revenue has led several other states to propose higher gasoline taxes, after years of avoiding it for fear of political backlash. These fees have met with resistance and criticism from pro-green and electric vehicle advocates whom worry these fees may discourage potential buyers.

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