‘Is there anything [they] can’t tax?’

Lawmakers in Illinois have proposed a new registration fee that would significantly increase the amount electric vehicle owners must pay annually. WTVO reported.

What’s going on?

Not having to pay ever-rising fuel prices and the fuel taxes that come with them has long been one of the main financial advantages of driving an electric vehicle. But as more drivers switch to electric vehicles, policymakers fear a decline in fuel tax revenue, which is typically used to pay for expenses such as road maintenance.

The Illinois proposal would use a different method to charge EV drivers, increasing the annual EV registration surcharge from $100 to as much as $320, according to WTVO. Alternatively, EV drivers can choose to pay 1.5 cents per mile driven.

Why is it important?

As more and more people switch from gas-powered vehicles to electric vehicles, the physical infrastructure and financial models built around internal combustion engines will need to be updated and changed. This includes replacing gas stations with charging stations and finding new ways to finance road construction and maintenance.

However, with federal tax incentives for using electric vehicles expiring years earlier than originally planned and more and more states looking for new ways to tax electric vehicle drivers, many people are wondering whether buying an electric vehicle still makes financial sense.

To find out, a curious YouTuber studied the cost of owning an electric vehicle compared to a gas-powered car for a year and found that the electric vehicle allowed them to save thousands of dollars on gas.

Yet increasing EV taxes and fees could reduce these savings and potentially harm EV market growth.

Commenters Facebook There were mixed reactions to the Illinois proposal.

“Is there anything [they] Can’t you pay taxes?” asked one commenter in disbelief.

“That’s fair,” added another. “EV needs to be taxed differently.”

What is being done about this?

If fewer drivers pay gas taxes, states will need to find alternative ways to fund highways and other projects. But it’s important to do this in a way that doesn’t feel like you’re penalizing people for driving electric vehicles.

Illinois’ proposal to increase registration fees, set to take effect in 2027, is a potential option. If the Illinois bill passes, other states could follow suit.

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