Free EV rides on American roads may end as proposed federal road tax set much higher than gas-powered vehicles

Representative Sam Graves (R-MO), chair of the House Transportation and Infrastructure Committee, has announced a plan to introduce a new annual fee for electric vehicle owners, which could reach up to $550 annually.

He is framing the proposal squarely as a fairness issue, since most revenue for federally funded road repairs is collected through diesel and gasoline taxes, which the heavier electric vehicles don't pay. According to some studies, electric cars are damaging roads much more than ICE vehicles on account of the extra weight they carry.

The Highway Trust Fund that pays for road and bridge upkeep, on the other hand, is being depleted just as EV adoption climbs. Since 2008, more than $275 billion, including $118 billion from the 2021 infrastructure law, has been shifted from the general fund to cover the shortfall. 

The current surface transportation legislation is valid until September 30, and the new five-year bill that will be introduced in ⁠April will include the first EV road tax on a federal level. Previous Republican efforts to add fees of $250 for EVs and $100 for hybrids were not included in last year's tax and spending bill, as there was no time to add them.

Earlier, some senators floated a far more punishing $1,000 annual EV tax, so the new proposal lands somewhere in the middle. Advocacy groups are already pushing back hard, pointing out that the average gas tax paid by internal combustion vehicle owners is only around $88 per year, making the prposed EV fee look less like fairness and more like a penalty.

The proposal also lands in a hostile climate for EV ownership more broadly. The Trump administration has already repealed the $7,500 EV tax credit, and the new fee would pile onto registration costs that some states have already raised. This may shift the calculus for buyers weighing an EV purchase in 2027, especially if Tesla and other EV makers have to raise prices due to the rising costs of batteries, memory chips, and materials.

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