General Motors Fighting EV Tax

General Motors fighting EV tax
General Motors fighting EV tax

If you look back in the history of electric vehicles the name of General Motors will appear time and time again, but not always in a positive scenario. However, General Motors has come out fighting with news that Michigan is looking to raise $1.2 billion a year through a special electric vehicle tax. This is not the first state to propose an EV tax, this will not be the last state, and the fight will go on for many years to come.

Many will find it ironic that General Motors is now supporting the electric vehicle industry and going against the U.S. authorities when historically many believe that the company was allegedly in collusion with the likes of California. So what can we expect from this battle?

Is it too soon for EV taxes?

Whether we like it or not, electric vehicle taxes will come in at some stage ,although many had hoped this would be years down the line. While Michigan has taken the headlines with a move to raise $1.2 billion a year, allegedly for road improvements, the likes of Washington, Virginia and Nebraska have already introduced their own brand of taxes. There are also many other states looking down this particular avenue and while the introduction of General Motors is welcomed by EV enthusiasts the reality is it will take more than just one company to take on the establishment.

Quote from ElectricForum.com : "The US government has not increased the federal gasoline tax since 1993 which will surprise many people. The 18.4c rate per gallon rate today would be 28.97c per gallon (+57%) at the end of 2012 if it had been increased in line with inflation since 1993."

There is a growing feeling that to introduce debilitating EV taxes at this moment in time would not only slow down the evolution of electric vehicles but also scare off many potential EV enthusiasts of the future. Just when governments around the world seemed to be getting a handle on the EV market it seems that local authorities now see this as a way of milking EV enthusiasts - even at this relatively early stage of development.

Should electric vehicles be exempt from road tax?

While politicians across the U.S. will continue to highlight the fact that electric vehicle users do have an impact upon the quality of roads in their locality, nobody is suggesting that EVs should be exempt from taxes forever. The reality is that electric vehicles today are more expensive than their gasoline counterparts and indeed there is an argument that EV enthusiasts of today are supporting the industry and should be applauded for doing so.

If we look at this particular argument from a commercial point of view, the fact remains that as EVs become more popular across the U.S., and indeed across the world, there will be a reduction in state and national income from gasoline taxes. It makes obvious sense that local and national governments will need to address these potential budget issues although whether effectively strangling a developing industry at such a relatively early stage is the right way forward is certainly a point of discussion.

Conclusion

It will be interesting to see whether General Motors introduction to the mix ends up being some kind of publicity stunt or indeed whether the company is willing and able to take on the establishment. We've already seen the likes of Elon Musk supporting the industry both publicly and privately so perhaps the introduction of General Motors into the public domain is long overdue?

On one side we have the politicians looking to raise more money, on the other side we have electric car manufacturers looking to create a new industry, and in the middle we have the motoring public and taxpayers. Which side the motoring public and taxpayer decide to fall on will ultimately decide the success of short-term state taxes on electric vehicles.