US Republican senators call for US$1,000 tax on new EV sales to pay for road repairs

WASHINGTON: A group of Senate Republicans on Wednesday proposed a US$1,000 (RM4,470) tax on new electric vehicle purchases to account for the cost of federal road repairs.

Most revenue for federally funded road repairs is collected through taxes on diesel and gasoline, which EVs do not pay.

The one-time US$1,000 fee charged at the time of purchase would be roughly equivalent to what drivers of conventional vehicles pay in federal gas taxes over 10 years for highway funds, said Senator Deb Fischer, the lead sponsor of the measure.

“EVs can weigh up to three times as much as gas-powered cars, creating more wear and tear on our roads and bridges. It’s only fair that they pay into the Highway Trust Fund just like other cars do," Fischer said, saying gasoline-vehicle users typically pay US$87 to US$100 (RM447) annually to the trust fund.

Transportation Secretary Sean Duffy said last month he thought EVs should pay for road use. "They should pay for use of our roads. How to do that, I think, is a little more challenging," said Duffy.

Some states charge fees for electric vehicles to cover road repair costs. Congress for the past three decades has opted not to hike fuel taxes to pay for rising road repair costs.

Since 2008, more than US$275 billion (RM1.3tril) - including US$118 billion (RM528bil) from the 2021 infrastructure law - has been shifted from the general fund to the Highway Trust Fund to pay for road repairs.

Congress is also considering eliminating the US$7,500 (RM33,525) EV tax credit, while the Trump administration has frozen EV charging funds and is moving to rescind aggressive emissions rules that the Biden administration estimated would force automakers to build a rising numbers of EVs to comply.

EVs still face hurdles among consumers including that they are typically more expensive than equivalent gasoline-powered versions.