Oregon has an innovative plan to get rid of its gas tax – Business Insider
Oregon was the first state to implement the gas tax in 1919, and may be the first to abandon it.
Starting this month, Oregon drivers have the option to pay-by-the-mile for road usage instead of by how much gas they purchase.
OReGO, as the program is known, launched on July 1 with the a goal of enrolling 5,000 participants to test the three private partnerships set up by the state’s Department of Transportation for this trial run.
The scheme is designed to shift road tax revenues from a gasoline-based structure to what supporters believe is a more fair approach, given the increasing number of hybrid and electric vehicles.
Under the scheme, drivers will pay 1.5 center per mile driven in the state, and then receive credit on their bill for the 30-cents-per-gallon paid at the pump as state gas tax.
“Oregon and other states know that the gas tax drivers pay at the pump isn’t cutting it anymore,” said Oregon Department of Transportation Director Matthew Garrett in a press release.
“As newer cars squeeze more miles out of each gallon of gas, and more hybrid and all-electric vehicles are sold, paying for road use by the mile instead of by the gallon ensures that everyone pays their fair share – no more, no less.”
Average miles-per-gallon of vehicles in the United States has improved considerably, from just 16 in 1980, to over 24 mpg in 2013, according to the Bureau of Transportation Statistics. Portland, Oregon has the most hybrid cars registered of any American city.
In the two weeks since the program launched, OReGO has seen about 600 registrations, a spokesperson told Business Insider. They also stressed that there is no set end-date for the program, and that it is not likely to ever fully replace a state gas tax in Oregon.
Several other states, including Washington, California, Colorado and others, are considering similar programs.