The Tax Foundation of Hawaii is not pleased with the state's proposed taxation of electric vehicles.



Last Tuesday, Hawaii's Senate Ways and Means Committee introduced Senate Bill 2324.  If passed, this bill will require EV owners to pay $60 annually as a way to make up for the state's lost gas-tax revenue.

As Pacific Business News reports:

"The bill says that the owner of a gas- or diesel-powered vehicle who drives 12,500 miles a year will typically pay about $140 in state and county fuel taxes, while owners of electric vehicles pay substantially less in taxes."

“The Legislature believes it is appropriate to create an electric vehicle user fee to offset the difference in taxes as an interim measure until a suitable mechanism for collected a vehicle miles-travel tax can be implemented."

The Tax Foundation of Hawaii disagrees with the bill's "interim measure" wording, stating:

“While the measure states that the proposed fee is an interim solution until a suitable mechanism can be implemented, it should be remembered that once a fee or tax is adopted, it is difficult to repeal.  Once it makes its way in the door, it can be expected to increase in subsequent years.”

We see no issue with this $60 annual fee, as it or something similar is becoming increasingly common throughout the US.  In fact, Hawaii's $60 tax is on the low side, so we're not sure why there's dispute here.

Source: Pacific Business News

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