Fleet Management

Taxed by the Mile: The Future of Driver Taxes

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Finding Alternatives to Gasoline Tax Dollars to Maintain Statewide Infrastructures

While most drivers are enjoying the significant drop in fuel prices in recent months, there are federal and state officials who are more concerned than ever about gasoline tax dollars available to maintain public roads. Though the gas tax has been a reliable source of revenue in the past, factors like vehicle fuel efficiency have slowly begun to affect the bottom line, putting economic pressures on transportation development. The reality is that the gas tax at the federal level is not indexed to inflation, and since the last time it was raised nearly 20 years ago in 1993, its purchasing power has substantially declined.

Lawmakers and stakeholders have come together forming groups such as the Mileage-Based User Fee Alliance to find alternative solutions to maintaining statewide infrastructures. Oregon is among the handful of states that have participated in these taxed by the mile pilot tests. Following a Road Usage Charge pilot project, the state has announced that they will be the first to tax commercial vehicles by the mile beginning July 1, 2015.

Details on The Road Usage Charge Program

  • The Road usage charge is a per-mile fee that replaces the state fuel tax for vehicles driving on Oregon roads.
  • The tax will specifically charge drivers traveling on Oregon public roads, not private due to GPS capabilities.
  • Privacy is guaranteed and protocols will be in place to prevent the government from tracking where you drive.

The Oregon Department of Transportation (ODOT) has recently recognized our innovative and accurate technology, naming it one of the official Commercial Account Manager (CAM) solutions. Azuga’s technology will accurately track mileage and gasoline consumption on each vehicle, and each vehicle will be billed monthly. The Road Usage Charge does take into account (and deducts) any gas taxes that were paid by drivers for the miles driven.

As directed by Oregon’s Senate Bill 810, the RUCP must give motorists choices for the technologies they use to report miles driven, as well as how they manage and pay their road use charges. In addition, vehicle owners will have the opportunity to obtain services through nongovernmental entities for cost-effective market-driven options.

Now, Accuracy in GPS Data Will Be More Significant Than Ever

Every single mile tracked will directly affect fleet managers’ ROI. Plain Old GPS System (or as we like to call it, POGS) won’t give drivers the accuracy they need to be taxed fairly. While states like Washington, Nevada and Texas are all discussing this tax proposal at the legislative level, it’s time for fleet companies across America to start preparing for these changes and understand how their bottom line will be affected.

If the mileage-based tax laws passed in the states where your fleets drive, wouldn’t you want to ensure accuracy in the data reading technology? We invite your thoughts on this matter, and will continue to update you on the latest news concerning tax by the mile state programs.