The Information Technology and Innovation Foundation proposes road user-charges (RUC) to help fund national infrastructure improvements. As infrastructure comes to the policy forefront, some lawmakers propose increasing the “gas tax” to help fund important bridge and road renovations.

Several States increased he Gas Tax over the years. However, critics of the gas tax worry that it is not a long term solution as more electric vehicles join the road force. The tax may miss a significant portion of drives as EV owners avoid the gas tax.

The ITIF proposes a RUC system where technology is deployed in the vehicle to log miles traveled. The RUC system, which would apply a tax on drivers based on their mileage, would be monitored (1) odometer checks (2) RFID tags to monitor fuel purchases or (3) the monitoring of use based on technology connected to the vehicle’s diagnostics.

Concerns about the RUC involve privacy. ITIF argues that the RUC system could be made more private than current systems. Steps could be taken to minimize the information governments have access to related to an individual’s driving and usage. Critics additionally argue that the RUC tax is regressive or that some vehicles would take ‘unpriced’ roads to avoid taxation.

The proposal from the ITIF raises key questions about the future of tax systems as our society improves digital technology.  


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