Automaker Alliance Proposes Weight-Based Fee to Avert 46% Highway Fund Cut
The Alliance for Automotive Innovation proposed replacing the 18.4¢ gas tax with a vehicle fee based on weight to prevent a 46% cut to the Highway Trust Fund by 2028. The plan applies to vehicles to offset a 60% gas-tax revenue decline and curb $275 billion in fund shortfalls.
1. Proposal Details
Alliance for Automotive Innovation CEO John Bozzella proposed scrapping the 18.4-cent federal gasoline tax and instituting a weight-based registration fee on all vehicles. The plan would assess charges proportional to vehicle mass and represents automakers including Toyota, GM, Volkswagen and Hyundai.
2. Highway Trust Fund Shortfall
The Highway Trust Fund is projected to face insolvency in 2028, triggering a 46% cut in federal surface transportation spending. Federal gas-tax revenue has declined 60% in real terms since 1993, prompting over $275 billion in general fund transfers since 2008.
3. Implications for Automakers
A weight-based fee could increase costs for heavier models, notably Toyota’s SUVs and trucks, and alter consumer purchasing decisions. Automakers may need to adjust pricing strategies and product mix, especially as electric and hybrid vehicles further reduce gas-tax contributions.