By: U.S. Senator John Barrasso
October 6, 2018
When Congress first mandated a taxpayer subsidy for electric car buyers back in 1992, the market for these new vehicles was tiny and the choices were very limited.
Today, nearly every major carmaker in the world is building or planning to roll out an electric vehicle, including luxury brands like Bentley, Aston Martin and Maserati.
Almost 1 million of these vehicles are on the road in the United States. Yet U.S. taxpayers currently pay up to $7,500 on every one of them sold in America.
Time's up on the electric car subsidy. The foundation for automakers to create a sustainable electric-vehicle market exists. Taxpayers should be off the hook.
Between 2011 and 2017, electric-vehicle buyers received $4.7 billion in tax credits. According to the Manhattan Institute, stopping the tax credits now could save taxpayers roughly $20 billion.
I'm introducing legislation that would kill it, and also level the playing field for every driver who pays into the highway trust fund.
Removing the federal subsidy won't collapse the electric-vehicle market. Forty-nine states have created their own subsidies. Most have also made it simpler to license or purchase electric cars.
California even mandated that a certain percentage of cars sold in the state must be zero-emission vehicles — almost exclusively electric cars for the foreseeable future.
Ending subsidies for specific vehicle types isn't just about saving taxpayer money — it's also about fairly spreading the burden on taking care of America's roads.
The U.S. Highway Trust Fund pays to maintain our interstates, bridges, and other surface transportation projects. Drivers of traditional gas-powered vehicles pay into the Highway Trust Fund through a gas tax every time they fill up at the pump.
The fund is due to run out of money in 2021. While there are some that want to raise gas taxes to top up the fund, I do not. Raising the gas tax disproportionately hurts lower-income families and ignores the changing landscape of rising energy efficient vehicles.
Drivers of electric cars pay nearly nothing for the wear and tear on our nation's roads. Yet a Tesla causes just as much strain on America's highways as traditional fuel-powered vehicles. Instead of paying into the Highway Trust Fund, buyers of electric vehicles get a check from Washington.
My plan bolsters the Highway Trust Fund by making sure all drivers pay to improve America's roads. It directs the Trump administration to create an annual highway user fee for alternative fuel vehicles. That fee is calculated using rates comparable to those already being paid by the drivers of traditionally powered vehicles.
The U.S. Energy Information Administration projects 4 million light-duty electric vehicles will be on the road in 2025. If that holds true, this change will generate several billion dollars for the Highway Trust Fund over the next decade.
That alone won't make the trust fund solvent, but it's a good start. And it's fair. Helping maintain our roads is critical for all taxpayers, including electric-vehicle drivers.
August marked the 35th consecutive month of year-over-year sales growth for electric cars in America. This market is established; it no longer needs the crutch of government assistance.
New technology is making cars cleaner, more efficient, and popular to buy. But it shouldn't be the American taxpayers' job to subsidize them.
Barrasso, a Republican Senator from Wyoming, is chairman of the Senate Committee on Environment and Public Works.