Tolls + Technology = Inefficiency

Posted in: Our Legislative and Regulatory Issues

Tolls are finally becoming "interoperable," according to representatives of the so-called "tolling industry," the folks who used to nickel and dime drivers but today extract much larger sums.  What this means, once the system is up and running, is that drivers can travel on toll roads in various states and most of the time, receive a bill for their tolls.

A representative of the industry stated in a press release touting the development: "This is an important development on the path to nationwide interoperability... that could help knit together regions of tolling interoperability... and make traveling easier for motorists.”

While it sounds like a technological breakthrough, it is anything but that.

Taking photos of drivers' license plates, identifying the type of transponder (or lack thereof), hunting them down in various state data bases, and then billing them, seems in this day and age to be inefficient and labor intensive.  And the rates of toll evasion are high.

There is a much more effective system in the marketplace, one that is highly efficient and virtually evasion free.  Even better, instead of tracking down thousands of motorists each day, the system relies on about 1,500 taxpayers nationwide to equitably tax virtually every driver in the U.S. 

When transportation fuels are transferred in bulk at the wholesale level, the fuels are taxed at a per-gallon rate. Those taxes are electronically remitted to the Internal Revenue Service. It's a tried-and-true method of tax collection that transfers billions of dollars annually to the highway trust fund. It's called the fuel tax.  So long before a driver fills up his vehicle and ventures down the road, the taxes have already been paid.

It's not a perfect system, though it's close to perfect in simplicity. And  the flaws are easily rectified with a very simple change: a rate adjustment. The taxes were set 20 years ago and haven't changed.  Miles-traveled is on the decline, and with vehicles getting superior mileage, the rates most definitely should be changed. But for efficiency and effectiveness it can't be beat.

The answer to our funding shortfalls for infrastructure can be easily fixed by adjusting the fuel tax, with "interoperability" already built in.  

About the Author

Holly Alfano

Holly Alfano

Holly Alfano represents the interests of truckstops and travel plazas before Congress and regulatory agencies. She leads NATSO's advocacy efforts on tax and fuel issues. 

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