Designing Alternatives to State Motor Fuel Taxes
All states rely on gasoline taxes as one source of funds for road improvement and maintenance. Historically, gasoline usage has been roughly proportional to road usage for mostlight vehicles, so the gas tax could be viewed as a user charge. Increasing fuel efﬁciency andalternative fuel vehicles reduce both the equity of the revenue source and its growth overtime. At the same time, improved technology has made more direct pricing of road usage morefeasible. This paper reports on the economic issues that arise in moving toward the moreextensive use of road pricing as a substitute for fuel taxes.