Politics as Usual: Washington State's $100 EV Tax Doesn't Make Sense

By · December 31, 2012

Charging EV in Washington

Charging up at the Jefferson Park Jubilee in Seattle: Washington is EV-conscious. (Flickr/LitlNemo)

When I wrote this, Congress was still debating a deal only hours before reaching the fiscal cliff, proving that political posturing is more important than actual results in the nation's capital. But that’s true not only in Washington, D.C.—they’re acting just as dumb in Washington State, where beginning in February battery electric car owners will pay an annual $100 fee in lieu of gasoline taxes.

One Hand Giveth, the Other Takes it Away

Why is it dumb? Well, Washington also exempts battery electrics from the 6.5 percent state sales tax (and exempts charging station parts and labor), so isn’t the state incentivizing electrics with one hand and penalizing them on the other? Maybe it would make more sense to have owners pay a fee based on the actual miles they drive, or simply have them pay a percentage of that sales tax.

Earlier this year, when it passed the legislature, State Senator Mary Margaret Haugen justified her bill this way: “We think the purchase of electric vehicles is great for the environment but we also need to maintain our roads, which is why we have the gas tax. Electric vehicles put just as much wear and tear on our roads as gas vehicles. This simply ensures that they contribute their fair share to the upkeep of our roads.”

EVs Should Pay, But Not Yet

I’m not saying this idea is totally without logic—electrics should pay for road improvements, and they’re not going to do it at the gas pump. But there’s so few of them on the road, even in EV-friendly states like Washington—that the amount collected from this will be negligible. It’s a bill for appearance sake. Also, by making it a flat fee it encourages EV owners to drive as much as they can, which adds to wear and tear on the roads.

Washington Plugs In

Washington Secretary of State Paula Hammond with Commerce Secretary Rogers Weed celebrate the I-5 charging corridor. (Flickr/WSDOT)

Paul Scott, an EV activist and Plug In America co-founder who also sells Nissan LEAFs in Los Angeles, concurs. “It’s a bone thrown to the right wing to say ‘We are taxing the treehuggers, too.’ Plug-in proponents are in favor of taxing electric cars to support road building and maintenance, but not while we’re still trying to get economies of scale. Internal-combustion vehicles don’t come close to paying their way, so to complain that EVs should pay for roads is a bit disingenuous.”

Jay Friedland, Plug In America's legislative director, adds that it's even worse than that: "The tax affects less than 2,000 vehicles in Washington State and potentially costs more to administer than it brings in," he said. "It's very poor public policy when they have a sales tax exemption for EVs at the same time they do something like this road tax. If they were serious about revenue they would be taxing all alternative fuel vehicles, including hybrids, but clearly they wanted to just make a statement."

Oddly enough, the right seems to agree that this is window dressing. A Breitbart.com story on the tax is entitled, “Washington State Pushes Electric Cars, Then Taxes Owners.”

EV-Friendly State

The state’s “Electric Drive WA” page touts, “With one of the cleanest electricity supplies of any state, Washington can significantly reduce its pollution and carbon footprints as more consumers adopt plug-in vehicles….Users of electric vehicles enjoy very significant savings in fuel costs. In Washington State the cost to drive 100 miles with an EV is about $1.50, compared to about $10 to $12 for a typical fuel-efficient gasoline car.” Fair enough, but now you have to factor in the $100 fee.

Washington does seem enthusiastic about EVs, though not as enthralled as California (which offers rebates of up to $2,500). The state partnered with AeroVironment to put fast chargers along its section of the I-5 corridor, making possible a west coast all-electric run.

Fee Could Change

Haugen’s office told me last February that the $100 fee would be automatically converted to a vehicle miles traveled (VMT) system if the state makes a similar change to the gas tax, which is currently at 37.5 cents per gallon. EV owners are fairly affluent, so a VMT-based tax probably won't convince many to stay home, but it's still a more logical approach.

Automakers, especially General Motors, have been vocal in opposing taxes on electric cars, making the same point as Scott—it’s too early in the evolution of the plug-in vehicle to start introducing fees of this kind. But other states are weighing the same political considerations—Oregon and Kansas have also considered imposing similar fees on EVs.


· Warren (not verified) · 5 years ago

There is nothing logical about any of the incentives for EV's, so far. Instead of basing tax rebates on efficiency and range, they are based on battery size, the bigger the better.

· · 5 years ago

This is seriously the dumbest argument about EV incentives I've ever seen. The sales tax you're not paying on a LEAF is easily worth 20+ years of $100 annual fees, to say nothing of the tax you're not paying on gasoline you're no longer buying. Some days it seems like some people just won't be satisfied with anything less than a completely free car for life.

I fully support incentives and tax structures to help nudge society and culture towards better ways of doing things, but there are still bills to pay that everyone needs to pitch in for. Just cough up the Benjamin and be happy that you're still coming out ahead financially, ecologically and ergonomically. Sheesh.

· CharlesF (not verified) · 5 years ago

The tax is as dumb as a box of rocks. The $100 tax is the same as an ICE car buying 266.67 gallons of gasoline. At 100 MPGe that would be the equivalent of driving 26,667 miles. Even at 30 MPG, that would be the equivalent driving 8,000 miles, which is longer than Nissan expected the typical Leaf to be driven in a year.

As for EVs or even passenger ICE cars paying their share, trucks do far more damage to roads then cars. A study from the late 70's stated that an 80,000 pound truck damaged the road as much as 9,600 4,000 pound cars.

If the goal was to be fair, cars would almost not be taxed at all. If you must tax cars, tax them for their miles driven times the cube of their weight. I am assuming that Washington has an annual inspection where the odometer reading could be recorded, making such a tax possible.

· Anonymous (not verified) · 5 years ago

I live in Washington state and in 2012 bought an all electric NEV (neighborhood electric vehicle) which is charged at home with 110v current and has a top speed of 25 MPH! While WA exempted me from paying the sales/use tax because of the classification as an "alternative fuel vehicle" I am restricted by WA law to roads posted 35 MPH or less. My NEV weighs less than 3K pounds - WOW, lots of wear and tear on city/county streets and NONE on highways which I can't drive on at all! I charge it with standard 110v electricity which costs about 8-10 cents a KWH.
I pay more than $100/year on my electric bill in taxes to the state. This additional $100 "fee"... call it what it is a TAX.. which amounts to double taxation on the same vehicle! One TAX because it uses only battery power and is taxed via the electricity used to charge the batteries and another TAX because the NEV does NOT require gasoline! Politicians have one thing in common whether in Washington D.C. or Washington state... they are willfully ignorant and pass laws accordingly.

· Lad (not verified) · 5 years ago

What you see here is the prescience for taxing EVs; it's $100 this time; when they become popular, the taxes will rise accordingly,perhaps $200 next year...watch as the politicians discuss taxing the battery part of a PHEV next.

The political game of finding revenue is continuous; but, there are few ideas from them about downsizing Government to cut costs.

· · 5 years ago

You want dumb? Arizona will give you dumb. Arizona - ‘the sunshine state’, the state that aspires to be the leader in solar energy development - has no real incentives for purchasing a potentially sun-powered BEV. There is a license tax waiver IF your car qualifies as an “Alternative Fuel Vehicle” (AFV). But to get it your AFV can not be capable of propelling itself with anything other than that alternative fuel.

So here’s the way it works out. The Nissan LEAF – the BEV that can’t take the heat – qualifies for that license tax waiver. Buy a brand new Volt, however, and you’d better plan on forking out $619 + for license fees the first year. This is because people who fork over an extra $10 - $12k for that big battery presumably do so only to get that lower licensing rate, a rate which declines (thankfully!) as the car ages.

Oh and you probably will be paying an electricity tax for all those highway miles you are logging with your BEV, as well. You and all those other BEV drivers pay for those city roads with other taxes. But right now you are not paying your fair share for all those county and state roads you travel.

To be fair, this obsession with fairness is probably more a product of Arizona’s political history than its obtuseness. About ten years ago its legislators voted in an overly generous AFV subsidy and then went out and bought themselves huge natural gas-capable land yachts. It had to be canceled before the rest of us could get in on the scam and bankrupt the state.

So there it is Volt owners and GM. There is your reward for doing the right thing – or doing it right - in Arizona. There is a message in this for BEV purists as well. Traction batteries are there yet as a complete replacement for a tank of gas – and may never be in the lifetimes of many of us. There is also a message for Arizona car dealers just interested in ‘peddling the metal’ and indifferent to the state’s depredations on the pocketbooks of its ‘do-gooders’. I walked away from a Volt from a local dealer at about the same price I ultimately paid for one after allowing enough time to reconcile myself to all the raving craziness.

· · 5 years ago

"Maybe it would make more sense to have owners pay a fee based on the actual miles they drive, or simply have them pay a percentage of that sales tax."

No thanks. I'll pay the $100 fee instead.

That "6.5%" tax is actually close to 10%, once you add the county & city sales taxes. So, Leaf would have got nearly $3,500 in sales tax. That covers 35 years of $100 fee. For a Model S, that could be $7,000 or more !

The sales tax is also exempt on lease.

· Paul Scott (not verified) · 5 years ago

All of these machinations in various states to gain tax revenue from plugin cars is because they haven't the balls to do the right thing and internalize the externlities of dirty energy. All of this mess could be avoided, the federal and state incentives for plugin cars could be eliminated all together if ICE drivers were forced to pay the full cost of their filthy fuel. Same for the buyers of dirty kWh.

But since we lack leadership at both the state and federal level on this matter, we see piecemeal efforts such as this misguided attempt. Let's hope OR and KS are smarter than WA.

· · 5 years ago

The thing about taxes is they always start out at a trivial amount ($100). The Income Tax was sold on "Tax the Rich!!!!!".

How much you want to bet it will be under $1000 ten years from now?

· Lad (not verified) · 5 years ago

You and I think alike,
Here's how you clean it all up: Cancel the federal fossil fuel subsides and tax the production of carbon energy; then you return the collected taxes not to the Government but directly to the people. Think about what would happen if you made the fossil fuel industry pay the real cost of doing business, including the health and environmental damages of their products.

Giving the money back to the people would introduce immediate spending and help bring back the economy; investors would place bets on clean energy; at the same time people would become a lot more interested in buying the cheaper fuel, which would then be electricity created by alternative energy sources and only Made in America, not China.

But,it will never happen because of the "bought politicians" in Washington D.C. Too bad!

· Josh (not verified) · 5 years ago

I think the state should charge based on miles driven, with a multiplier for vehicle weight and a fee for gas-guzzlers (so, that 14 MPG Bentley or Cadillac would chip in a bit more for having such pathetic fuel economy). Even better would be to include a method for congestion tolling, but that might be via a separate system, such as our Good to Go! tolling system.

· Objective (not verified) · 5 years ago

What a bunch of crybabies.

· Greenman (not verified) · 5 years ago

This is a stupid idea created by stupid people. Legislators can never leave anything alone and believe that incessant legislating is their role. As EV numbers increase there will need to be some way to help pay for the road system, but let's face it, that's still not true for gasoline and diesel powered vehicles.

· Cord (not verified) · 5 years ago

A) Roads need to be paid for by those that use them. B) Those that drive ICE cars, can easily pay more than $100/year in gas tax. C) It's not a bone to the "Right Wing", I as a Leaf driving Right Winger, think this is more than fair for ev drivers such as myself (2011 Leaf SL). D) Any one who thinks that this would be an expensive tax to collect is just an idiot, the state adds $100 for each year to the vehicle registration, duh. A VMT system would require auditors and field agents like say the IRS or sales tax board. lots of money out the window.
Seriously, stop your complaining and be happy with advanced auto technogy, complaining about a $100 tax make you look whiny!!

· · 5 years ago

As a LEAF owner in Washington state, I am OK with paying some tax for road maintenance and improvements although I'm not sure $100 is the right figure. BTW, I agree with the above commenter that a VMT would require a significant outlay of our tax money for collection.

It seems often forgotten that besides the weight of a vehicle and friction on the roads, it is also the escape of fuel, lube oil, and tranny fluid which dissolves road asphalt and vastly increases wear. I think the state should actually reward vehicles which carry none of these, like the LEAF and other purely battery cars, because the potential for the escape of these road-destroying liquids is eliminated by users of this technology.

· TD (not verified) · 5 years ago

If it's any consolation she did not get re-elected, though it had nothing to do with the EV tax.

· Jay (not verified) · 5 years ago

Good Reporting Jim, but one thing absent from this discussion was that the Seattle EV Assoc., in concert with the state's three other EAA affiliates managed to control the damage from this tax; exempting NEVs and motorcycles, and also got a study passed that is designing a pay-as-you-drive tax system that could replace both this silly fee and the gas tax. As the (now former) Senator Haugen said, this fee will go away if a Vehicle Miles Travelled tax or other form of user fee is passed, which SEVA supports. SEVA has a fair rep in the legislature because of this, and we've also shown restraint in not pushing for other favors, such as single-occupant HOV access. HOV lanes are primarily for reducing congestion, and a single-occupant BEV takes up as much space as a single-occupant gasser. I put 15k miles on my iMiEV last year, so this fee is indeed a bargain, but wrong in principle.

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