EV Owners in Washington State Soon to Pay $100 Annual Fee

By · December 26, 2012

Downtown Seattle

Beginning on February 1, 2013, owners of electric vehicle in the state of Washington will be required to pay a $100 annual fee to compensate for money the state loses in yearly gas taxes. The fee will be used for road and highway improvements. The law only applied to pure electric cars—not conventional or plug-in hybrid vehicles, such as the Toyota Prius and Chevy Volt.

About 1,600 vehicles are likely to be taxed in 2013. Owners of these vehicles—which include more than 1,000 Nissan LEAFs, a few Tesla Roadsters, and a handful of converted electrics—will be required to obtain a special registration, with the fee of $100 collected at the time of their annual renewal.

Supporters say that electric vehicles are beneficial from an environmental point of view, but that roads nonetheless deteriorate and need upkeep. Those against the law include most electric vehicle owners who argue that they already pay taxes on electricity and should not be subjected to an added fee.

Washington motorists pay a 37.5 cents per gallon gas tax, which is the state's largest source of transportation dollars. It costs the average driver about $200 a year—if calculated based on driving roughly 12,000 miles in a vehicle that gets 23 mpg.

"$100 isn't that big of a deal, but it's not well-balanced policy. EV drivers really want to pay their fair share but it seems ridiculous from a policy standpoint," said Jay Friedland, legislative director for Plug In America, a California-based electric vehicle advocacy group, in an interview with Associated Press. "The state, on the one hand, has given out sales tax exemptions to encourage residents to buy more electric vehicles, while charging the fee on the other hand."


· · 5 years ago

As discussed previously I still think this is pretty much spot-on in terms of what needs to be done. It's not a fee on your LEAF, it's essentially a fee for road use. Since there is no fuel tax to collect as a proxy for road use, they need another means so BEV/PHEV owners continue to pay their share of road maintenance expenses.

The tax you pay on electricity does not, and arguably can not, be spent on transportation - I'm willing to be there are rules tat woldmake it very difficult to just move money around like that. It's also reasonable to argue that the tax you pay on electricity is nowhere near enough anyway, and someone who has solar panels could conceivably circumvent all that and get to use the roads for free (at least occasionally) which isn't right either.

Just be glad they didn't stick a toll booth at the end of your driveway, or worse a GPS unit in your car.

· Greenman (not verified) · 5 years ago

This doesn't make sense, unless you believe that gas tax only support roads and electricity tax only supports electricity infrastructure etc. I doubt that's true. If it is, that's stupid.

· Lad (not verified) · 5 years ago

Timing is everything; This is "a tax before it's time" and I'll bet it cost more in administrative costs to change all the forms and to manage the processes than it collects. But, Hey $160,000 will keep three Washington government workers on the job to manage the change for the year.

Washington, For God sake couldn't you wait another year so this Tax would at least pay for itself? I'm thinking you people in Washington are running wild, without thinking straight, just like your political mentors in Washington D.C.

· · 5 years ago

Roads are no longer majority funded by gas tax. This is a shortsighted law. They should be raising gas taxes first, until EV are a significant percentage of the registered vehicles. A quick Google turns up 2008 numbers of registrations at over 7 million. Lets assume by 2013 we are up to 8 million vehicles in WA. That means this law is going to slow EV adoption to get the equivalent of about 260 gallons of tax each from 1600 vehicles out of 8 million. EVs make up .0002% of the registered vehicles.

If they really want to be fair, charge every vehicle a penny per pound of curb weight, annually. A LEAF would pay $34 a year. A Suburban would pay $61 a year, a Navigator $60, a Smart $18, and an iQ $21. My motorcycle would be $8 a year. Curb weight impacts road wear more than fuel consumption.

And for heck sake, we should tax studded tires $100 per set of 4 at the time of purchase, to pay for road damage.

· · 5 years ago

@Greenman - The tax on electricity is sales tax. The vast majority of the time the utility grid is privately/quazi-privately owned, operated and maintained. As for what it's spent on: "Where does the gas tax go?" (PDF)

Also, gasoline tax is highly regressive. Not that this matters much given the point is to offset road wear, but a fairer system would be nice. We should be careful about how we use fuel taxes to incentivize EV adoption since it hits lower class working folks the hardest.

@valkraider If they REALLY wanted to be fair, they would charge people based on vehicle weight and annual odometer readings. The more you drive, the more you pay. Other than that I fail to see how this would be off-putting to an educated consumer base. $100/yr is about what most would be paying in gasoline tax anyway, so you're still coming out ahead by not buying the actual gasoline.

Don't get caught up in the "fuel consumption" mindset. How much fuel you use has nothing to do with how much you contribute to road wear. It has only ever been a proxy for lack of a better way to handle it.

· Anonymous (not verified) · 5 years ago

What about a shoes Tax to pay for the use of the sidewalks. They need maintenance don’t they?

· Anonymous (not verified) · 5 years ago

Money is fungible. It doesn't matter where the government gets its money from. All that is relevant is that the revenue-expense amount for the government is stable (it can be negative, as long as it is stable). It doesn't matter whether washington state gets money from EV owners thru electricity taxes or "road taxes" as long as the money is coming from somewhere.

There are only 2 reasons for the government to tax. To increase revenue so they have stable deficits, and to discourage certain uses. This fee, while inconsequential, fails on both accounts. It's only effect is cosmetic, and boy, is that a negative "we are short sighted idiots" message.

· · 5 years ago

@Anonymous: "Money is fungible. It doesn't matter where the government gets its money from."

This is largely false. There are plenty of state and federal tax laws that specifically prescribe that the money collected be put into a particular fund. taxes on motor fuels going to road maintenance is one example, Medicare and Social Security are examples at the federal level. More commonly, funding for particular things can only come from specific tax revenues: public schools from property taxes, for example. These kinds of "special taxes" vary from place to place of course.

It is absolutely not true that all your tax money goes into one big pile and divvied up. There are, amazingly, rules about how the money flows... and that's a good thing.

· Anonymous (not verified) · 5 years ago

"Don't get caught up in the "fuel consumption" mindset. How much fuel you use has nothing to do with how much you contribute to road wear."

Isn't that why a fee on weight was suggested in the comment? Also - while a weight/mile tax is ideal it is potentially invasive to privacy in some ways, and tough to administer in others. So while not ideal, a simple annual weight fee would go a good way toward the goal without too much hassle. A simple database of vehicle curb weights, a per-pound rate structure, and every year on renewal a fee based on vehicle weight. No more difficult than states with vehicle value based registrations (like Washington used to have).

· Anonymous (not verified) · 5 years ago

I favor weight times mileage, myself. Still not perfect (e.g., if you drive a lot out of state) but close enough, and it's easy to take odometer readings at the same time they do the smog check etc., so you just subtract the reading recorded last time (or when the vehicle was sold-and-bought, whichever is appropriate).

· · 5 years ago

I favor weight times mileage, myself. Still not perfect (e.g., if you drive a lot out of state) but close enough, and it's easy to take odometer readings at the same time they do the smog check etc., so you just subtract the reading recorded last time (or when the vehicle was sold-and-bought, whichever is appropriate).

· Hipster (not verified) · 5 years ago

Not everywhere does smog checks. But it could be on the "honor system" with any differences due at the sale of said vehicle (so it wouldn't do any good to lie because it would catch up to most people eventually).

It might not work in cross-border areas all that well, metro areas which cross state lines...

· · 5 years ago

Government Stupidity.

They could easily raise the gas tax as needed instead to make up for the lost income. This would have the nice side effect of discouraging gas use even more, and then they could raise it again.

My tax philosophy is simple: Tax only what you wish to discourage.
In a nutshell that would mean Consumption, Pollution, and Vices (Drugs, Gambling, and Prostitution - all 3 of which should be legal).

No Production taxes (No Corporate, Income or Payroll taxes), these are not things we wish to discourage, and getting rid of these taxes would eliminate most corporate lobbying and special interests.

And definitely no electric car or renewable energy taxes.

· · 5 years ago

@Anonymous "Also - while a weight/mile tax is ideal it is potentially invasive to privacy in some ways, and tough to administer in others."

Not every place has smog checks, but I think every place has safety inspections or at the very least periodic registration renewals. It need not be more invasive than it already is. Odometer tampering is also already a crime just about everywhere so that's already covered. I do oppose GPS-based proposals, though.

I suggested in past discussions that, in states with mandatory liability insurance, the tax could be rolled up in the insurance payments. It would be an extra ~$15-$20 per payment which is much easier to manage than a lump sum of $100+ per year.

@JoseG: "Tax only what you wish to discourage"

The problem with that is, if you succeed in discouraging it enough, you lose your tax revenue. This is not necessarily a problem if the money collected is used to offset damages and costs related to the unwanted activity (see: "feebate") but for costs that are constant or even increasing - like roads - that's a big problem.

Of course if we extend your logic to business... "we don't want to discourage people from buying our products and services, so we shouldn't charge them any money." Unfortunately I don't think you'll ever see how amazingly ignorant, shallow and shortsighted your philosophy is.

· hybrid driver (not verified) · 5 years ago

Based on weight would be easy to implement as that info is printed by the state on your vehicle registration document when you pay your tabs. All vehicles ICE, PHEV and EV should be charged the same annual fee with ICE owners penalized with the gas taxes for polluting the air. Mileage fees will be hard to implement as there is no reliable existing method and there will be resistance (mainly about privacy) about reporting your miles on a regular basis.

· Anonymous (not verified) · 5 years ago

This is like charging people a fee for not smoking.

· · 5 years ago

@hybrid driver: mileage based charges are easy to implement because they're done at the annual inspection (smog check, safety check, etc) (or re-sale if that occurs first). If you don't have an annual inspection that year (some places do a two-year cycle for new vehicles) you simply self-report your mileage. If you "cheat" you'll get caught the second year so it evens itself out (wow, you went ten miles last year but this year you went 23,990 miles, for an average of 12,000 miles/year, what a coincidence).

Then there's the fact that the mileage fee for any ordinary passenger vehicle "ought to" be roughly $3 per thousand miles anyway, or only about $36/yr for the average driver (but that's only about 1/3 of what they pay now, so this represents a decrease in revenue). It's the really heavy vehicles (fully loaded semi trailers) that really chew up roads, and maybe the fee could be double for passenger vehicles over 5000 pounds (some SUVs etc). I'd also suggest that, since roads wear out simply by aging as well as by weight-rolling-over-them, the fee actually be "constant + mileage", with the constant maybe $100/yr, which makes $136 a slight increase in revenue, which is probably needed by now.

· · 5 years ago

@Chris T. "...roughly $3 per thousand miles anyway..."

How was this number arrived at?

New to EVs? Start here

  1. Seven Things To Know About Buying a Plug-In Car
    A few simple tips before you visit the dealership.
  2. Incentives for Plug-in Hybrids and Electric Cars
    Take advantage of credits and rebates to reduce EV costs.
  3. Buying Your First Home EV Charger
    You'll want a home charger. Here's how to buy the right one.