New Transportation Bill Proposes Federal Fee for Electric Vehicles
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A new five-year surface transportation funding bill includes a provision to levy an annual federal registration fee on electric and plug-in hybrid vehicles. The bill also proposes a major investment of over $50 billion in America's bridges. The legislation has the support of the Democratic Party and is now under consideration.
Facts First
- A new five-year transportation bill proposes a $130 annual federal fee for EV owners, increasing by $5 yearly from 2029 to $150.
- Plug-in hybrid vehicles would face a starting fee of $35, rising by $5 annually to a $50 cap.
- The bill includes more than $50 billion for bridge investment as part of its infrastructure funding.
- States that fail to collect the federal EV tax could lose highway funds, with the federal government withholding 125% of the amount owed.
- The Democratic Party supports the legislation, titled the BUILD America 250 Act.
What Happened
The Transportation and Infrastructure committee published the BUILD America 250 Act, a bill to fund surface transportation for the next five years. The legislation includes a provision for an annual federal registration fee on electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs). It also proposes an investment of more than $50 billion in America's bridges.
Why this Matters to You
If you own an electric vehicle, you may be required to pay a new $130 federal registration fee each year, with that fee scheduled to increase over time. Owners of plug-in hybrid vehicles could see a smaller starting fee. This new cost could affect your decision to purchase or maintain an electric vehicle. The bill's passage could also lead to significant bridge repairs and improvements in your community, potentially improving safety and reducing commute times.
What's Next
The bill must pass through the legislative process, which may involve debate and potential amendments. If enacted, the EV fee structure would begin, with the first scheduled increase for EVs likely to occur in 2029. State departments of transportation will need to prepare to collect the new federal fee to avoid financial penalties that could impact their highway funding.