Tuesday, August 05, 2008

Miles Tax

Just to make my objections a bit clearer, I think in the present state of the world a gasoline tax is superior to a mileage tax even aside from big brother concerns. It roughly charges people by the mile, while also rewarding people for using less gasoline per mile driven. If electric cars and other non-gasoline consuming vehicles start becoming a significant portion of the overall fleet so that there's a desire to replace the lost revenue, the best way to do that is simply to increase the gas tax rate. In the real world there's no precisely optimal tax, and to get it close to right we'd have to know how the electricity driving those cars was produced, but at a first pass the gas tax is pretty good in that it discourages driving and encourages vehicles with good mileage.