In 1956, the federal government established the Highway Trust Fund. The basic idea was to use money collected from federal taxes on gasoline and diesel fuel to pay for the construction and maintenance of federal highways. When the interstate highway system was completed in the early 1990s, this obviously meant less funding was needed. however The Congressional Budget Office projects maintenance spending for federal highways. It will reach nearly $60 billion over the next few years and will gradually increase over time. Meanwhile, the Highway Trust Fund’s fuel tax revenue is less than $40 billion annually, gradually decreasing over time due to the rise of high-mileage cars in the short term and the rise of electric vehicles in the long term.
Of course, one option is to fill the gap with general tax revenues, which is what we have actually been doing for decades. But if we want to go back to something closer to the old “user pays” approach, where the main users of the highway pay for maintenance, here’s the argument: Michael E. Gorman, “Vehicle Mileage Tax on Heavy Trucks?” (regulation Magazine, Winter 2024-2025).
Why is mileage tax imposed only on large trucks?
1) Large trucks cause most damage on highways. Gorman discusses evidence from the most recent Federal Highway Administration report.
A 2000 Federal Highway Administration (FHWA) report estimated that road repair costs for combination trucks (tractors with one or more trailers) per mile traveled averaged 66 cents per mile (FHWA 2000). For all trucks, estimated road maintenance costs per mile driven ranged from 4 cents to 40 cents (in 2024 dollars) depending on load weight. According to Bureau of Transportation Statistics (BTS) calculations, trucks today actually pay 4 cents per mile (an average of 24.4 cents per gallon, which works out to an average of 6.1 miles per gallon).
Simply put, the fuel taxes paid by trucks do not cover the costs of highway maintenance they charge. As Gorman points out, large trucks also provide additional social benefits by contributing to air pollution and traffic congestion.
2) There are relatively few large trucks compared to passenger cars, and trucks already need to track their mileage for business and regulatory purposes. In fact, most trucks are already equipped with transponders for when passing through toll booths and weigh stations. Therefore, the practical task of applying a mileage tax to large trucks is relatively simple. Several states have implemented pilot programs to apply mileage taxes on trucks, including New York, New Mexico, Kentucky and Oregon.[w]The initial installation costs were significant, but the ongoing maintenance costs were minimal.”
3) A concern when applying mileage tax to personal vehicles is the possibility of violating users’ privacy. These privacy claims have little or no significance when applied to the heavy trucking business.
Of course, the trucking industry hates this idea. Currently, heavy trucks are receiving an implicit subsidy, and vehicle mileage taxes increase trucking costs to reflect actual maintenance costs. There may be other effects as well. For example, while a certain amount of freight may end up moving by rail, this movement should be viewed as a social benefit because the environmental and congestion costs of rail are lower. (If the United States were able to amend the Jones Act rules that increase the cost of ocean freight between U.S. ports, a certain amount of cargo might move across the ocean rather than land.)
One way or another, the cost of road maintenance is covered by general income or, if maintenance is deferred, by the additional wear and tear on the vehicles. For large trucks, vehicle mileage tax is a better option.
