Could New EV Taxes Kill the Industry Overnight?

Could new EV taxes kill the industry overnight?
Could new EV taxes kill the industry overnight?

Over the last decade, governments and local authorities around the world have been pushing the benefits of electric vehicles with regards to emissions and their impact upon the environment. While many governments have been investing significant amounts of money, and are still investing today, there has always been a suspicion in the back of people's minds that governments would eventually introduce electric vehicle taxes when they felt safe to do so. So when will we see taxes introduced?

Unfortunately, while the industry is still in its relative infancy (at least in this rebirth) the state of Virginia and Washington have already introduced their own green car taxes with New Jersey, North Carolina, Indiana and possibly another four states considering the same option. So what is going on?

Tax income from gasoline

Slowly but surely both national and state incomes from tax on gasoline have been falling. Historically, this has been a significant part of government budgets which is now being eroded. As a consequence, it seems almost inevitable that we will see new taxes right across the board in due course. These taxes will fill budget "black holes" but leave many motorists feeling duped having been encouraged to switch to "cheaper" and more efficient electric vehicles.

At this moment in time there is no national policy with regards to green travel taxes but the fact is that slowly but surely they are emerging. It is also worth noting that they would not be emerging unless the national government had given states permission and effectively waived them through, whether formally or informally.

Quote from ElectricForum.com : "If there is one industry which continues to split opinion it has to be the electric vehicle industry which has developed over the last decade but has yet to hit the mass market. Many people automatically assume that the industry will crash and burn, while others suggest electric vehicles and their future offspring will become the norm and take over from gasoline fuelled transport."

Could this kill the EV industry stone dead?

The fact is that the EV industry has not really recovered as yet from the 1990s when we saw the General Motors EV1 take the headlines. The government is still investing, together with private entities, enormous amount of money into electric vehicle technology - and more lately battery technology. To invest this level of money and then effectively increase the cost of each and every electric vehicle to the general public seems completely crazy.

The fact that much of this additional funding will not be reinvested into the EV industry has not gone unnoticed, with road repairs and other similar actions likely to come first. There's been no official comment from the array of electric vehicle manufacturers in the U.S., who were encouraged by the U.S. government to enter the industry, but they will be very concerned about the short-term outlook.

The future

While the quiet and "sneaky" introduction of various green car taxes across the U.S. has now been made public, it is not perhaps the amount being raised today which is of most concern. This could very well be the thin end of the wedge and once states have introduced relatively low tax charges on electric vehicles, what would stop them increasing them year-on-year?

Is this the start of a new conspiracy theory to kill the EV market dead? Are state and national governments looking to push motorists back towards gasoline powered vehicles? The fact is there are a lot of questions for politicians to answer and now that the secret is out in the open, more and more people will be asking what is going on.