Should Government Track the Miles You Drive?
One American gets up in the morning, gets in his car and drives down a congested highway to work.
Another wakes at noon and rides a subway to a saloon.
Which of these two -- if America's future takes a wrong turn -- would pay what might be called the "Buttigieg tax"?
CNBC's Kayla Tausche asked Transportation Secretary Pete Buttigieg in a March 26 interview what sort of taxes he perceived as possible ways to pay for infrastructure projects.
"First, a gas tax," she asked. "You called it old-fashioned to raise the gas tax. Do you still believe that? Could that go up?"
"Well," said Buttigieg, "the gas tax has traditionally been part of how we fund the Highway Trust Fund, but we know that it can't be the answer forever because we're going to be using less and less gas.
"We're trying to electrify the vehicle fleet," he explained.
Indeed, President Joe Biden last week called for spending $174 billion in tax dollars to promote electric vehicles, or EVs.
"He is proposing a $174 billion investment to win the EV market," said a White House fact sheet on Biden's American Jobs Plan. "His plan will enable automakers to spur domestic supply chains from raw materials to parts, retool factories to compete globally, and support American workers to make batteries and EVs. It will give consumers point of sale rebates and tax incentives to buy American-made EVs, while ensuring that these vehicles are affordable for all families and manufactured by workers with good jobs."
But, as even Buttigieg conceded, this would create at least one problem: If an ever-increasing number of Americans start driving electric cars, what will happen to the federal revenue derived from the tax on gasoline, which is now used to fund transportation infrastructure through the Highway Trust Fund?