President Joe Biden appears to have given up on potential plans to enact a “mileage” tax as part of a new and sweeping infrastructure package.
Department of Transportation (DOT) Secretary Pete Buttigieg had first suggested Friday that the Biden administration could move to impose a tax on vehicle miles driven as part of its upcoming $3 trillion infrastructure proposal, The Hill reported.
But by the next day, a DOT source had confirmed that no such provision was in the works.
“The secretary was having a broad conversation about a variety of ways to fund transportation,” a DOT spokesperson told Insider. “To be clear, he never said that VMT [vehicle miles traveled tax] was under consideration by the White House as part of this infrastructure plan — and it is not.”
“A lot of promise”
Speaking with CNBC on Friday, Buttigieg had said the tax, which would bill Americans based on how many miles driven, could be a good way to pay for the massive infrastructure bill.
He suggested that the recent rise in the use of electric vehicles makes gas taxes, which are currently in place throughout the country, less practical.
Instead, “a so-called vehicle miles traveled tax or a mileage tax, whatever you want to call it, could be the way to do it,” Buttigieg said.
“I think [the mileage tax] shows a lot of promise,” he added, as The Hill reported. “If we believe in that so-called user-pays principle, the idea that part of how we pay for roads is you pay based on how much you drive.”
Who’s footing the bill?
While a mileage tax may not be on the table, the Biden administration is still planning massive changes as part of its pricey new infrastructure bill.
According to The Hill, Biden has said the package is meant to “rebuild the infrastructure — both physical and technological infrastructure in this country — so that we can compete and create significant numbers of really good-paying jobs.”
Of course, the question still remains as to how Biden will pay for all of this. According to The New York Times, an increase in taxes on businesses and “the rich” could be on the horizon.
The full text of the president’s proposal is set to be released by the end of the week, The Washington Post reports.