Michigan Drivers Could Soon Be Taxed on Mileage

Michigan drivers may soon have to pay fees to the state based on the number of miles they drive – becoming one of the first states in the nation to employee this method of funding roads.

According to a report released earlier today by the University of Michigan, with traditional models to generate funds for Michigan’s roads now less effective due to declining fuel consumption and the advent of electric vehicles, it may be more advantageous for the state to tax residents based on the number of miles driven as opposed to raising taxes on fuel.

“Instead of continuing to raise fuel taxes to pay for transportation infrastructure, a mileage fee could more fairly allocate costs based on the number of miles driven, the time of day, the route taken, and the weight of the vehicle,” says the report.

Lead study author, Elizabeth Treutel, said that it could take five to ten years before the state in able to move to a new system, but she hopes the latest report will motivate lawmakers to make the change.

Other states considering the implementation of mileage-based tax include California, Florida, Minnesota, Texas and Wisconsin.

In Oregon, a pilot program of this model is allowing 5,000 drivers to receive refunds for their fuel taxes in exchange for moving to the mileage system.

How would you feel about being taxed on your mileage as opposed to fuel?