Pennsylvania vehicle mileage tax being discussed to replace lost gas tax revenue

vehicle mileage tax being discussed to replace lost gas tax revenue

PennDOT relies on gas tax to fund 78% of its’ revenue needs, far more than neighboring states

With major gas-powered automakers transition to manufacture electric vehicles by 2035 and people driving less during the pandemic, PennDOT officials say the gas tax is no longer able to generate the money that is needed to keep the state’s transportation network in good repair.

PA Governor Tom Wolf charges the Transportation Revenue Options Commission to come up with ideas to phase out the state’s gas tax that is around 53 cents a gallon, the second highest in the nation.

With that in mind, the commission proposed phasing in an 8.1-cent-per-mile user fee over a five-year period, doubling the state’s vehicle registration fee, higher sales tax on vehicle purchases, an electric car fee, and a goods delivery fee taking advantage of online buying and delivery.

As we wait for TROC’s final draft, they hope it would begin at the time of the governor’s budget presentation in February 2022 with the goal of acting on it by July 1, 2022.

Rebecca Oyler of the Pennsylvania Motor Truck Association said the trucking industry would oppose the proposed doubling of vehicle registration fees, which will make the commonwealth have the second-highest truck registration fee in the nation.

What is a Vehicle Mileage Traveled (VMT) tax?

A VMT tax has become a popular option because it makes the taxes on road use fair across all vehicle types. Instead of paying gas taxes at the fuel pump or high registration fees, drivers would pay based on how much they actually drive and would capture electric vehicles that do not fill up at a station.

A vehicle miles traveled tax (VMT) charges motorists based on their road usage measured in mileage using an onboard vehicle telematics device to capture the distance driven by a vehicle through GPS.

A recent study in the Journal of Public Economics found that implementing a vehicle mileage traveled tax is a more efficient policy than raising the gas tax as VMT tax is designed to increase highway spending $55 billion per year and increases annual welfare by $10.5 billion or nearly 20% more than a gasoline tax does.

In Oregon, where their experiment with a vehicle-miles-traveled fee has been hailed nationally as a bold step toward what may eventually become a reality, lawmakers are considering a bill that would require owners of new, fuel-efficient cars and trucks to pay a fee for every mile they drive beginning in 2026.

Oregon has estimated its highway fund, of which 40% comes from gas tax revenues, will be insolvent by 2024 without significant action.

However, current gas taxes are simple to administer at the pump and can be adjusted using existing mechanisms while a VMT tax would require installing new telematic devices in all personal and commercial vehicles to track distance traveled.

Many assume that this would require every vehicle owner to periodically (or automatically) report distance tax and create a new bureaucracy auditing these reports, which could eat up any gains in tax revenue.

The Oregon House Bill addresses these concerns as the fee would apply only to owners of new 2027 vehicles that don’t use gas or get 30 miles or more per gallon of gasoline and drivers would be able to opt out of tracking their mileage and pay a flat annual fee of $400. However, the flat fee provision would expire in 2030.

California and Washington are considering linking a drivers’ VMT fee to a formula that factors in the fuel efficiency of their vehicles, which Tesla—the electric vehicle company—testified as their suggestion, as well as this “provides an incentive for people to buy more efficient vehicles and to drive them more efficiently.”

We will have to wait to see what happens in Pennsylvania, but the discussion is heating up and there is pressure to solve the lost gas tax revenues quickly.

Need help with your Fuel Tax Reporting? 

CNS is a full-service tax provider that can manage the entire process for you from start to finish and offers custom simple solutions for companies of all sizes. 

Our fuel tax specialists will work with you to collect your data, ensure your fuel and mileage match, prepare your filings, and even file the paperwork for you directly. 

What CNS fuel tax team will do and what is needed from you.

For more information, contact us at 888.260.9448 or info@cnsprotects.com.

IFTA Fuel Tax Rate Changes Q3 2020

IFTA Fuel Tax Rates | IFTA | CNS

With 11 states showing a tax rate change, the Q3 IFTA return due date is October 31st.


What are the 2020 IFTA tax rates for the 3rd quarter?

The International Fuel Tax Association (IFTA) has released the 3rd quarter 2020 fuel taxes. You can download the full list of 2020 Q3 tax rates below and can also find more information on the International Fuel Tax Association at their website.

Which states had IFTA tax rate changes?

There were eleven states that showed a tax rate change, which include California, Illinois, Indiana, Iowa, Maryland, Michigan, Nebraska, New York, South Carolina, and Virginia. IFTA lists the 3rd Quarter 2020 Tax Rate Changes, which will go into effect on July 1, 2020.

Managing IFTA requirements can be challenging. Between tracking receipts, managing mileage logs, matching fuel to taxes, chasing drivers and filing with the jurisdictions, it is easy to see why many companies search out solutions for the complicated process.


Fuel Taxes: Free Estimate

Our Fuel Tax Specialists will give you a free estimate. They can also answer any questions you have on fuel taxes or reporting.

When are your IFTA taxes due?

The IFTA return due date for the 3rd quarter is October 31st. Take a look below for a list of IFTA fuel tax reporting for the each quarter.

  • 1st quarter (January to March) — April 30
  • 2nd quarter (April to June) — July 31
  • 3rd quarter (July to September) — October 31
  • 4th quarter (October to December) — January 31

Check out our industry library resources of 15 videos, 2 ebooks, industry links, and CNS In The News content.

CNS takes your fuel tax reporting worries away! 

CNS is a full-service tax provider that can manage the entire process for you from start to finish and offers custom simple solutions for companies of all sizes. 

Our fuel tax specialists will work with you to collect your data, ensure your fuel and mileage match, prepare your filings, and even file the paperwork for you directly. 

What CNS fuel tax team will do and what is needed from you.

IFTA Fuel Tax Rates (2019 Q3)

IFTA Fuel Tax Rates | IFTA | CNS

What are the 2019 IFTA tax rates for the 3rd quarter?

The International Fuel Tax Association (IFTA) has released the 3rd quarter 2019 fuel taxes. You can download the full list of 2019 Q3 tax rates below.

You can also find more information on the International Fuel Tax Association website.

Which states had IFTA tax rate changes?

There were seven states that showed a tax rate change, including Maryland, Montana, Nebraska, Ohio, Rhode Island, Tennessee and Virginia. IFTA lists the 3rd Quarter 2019 Tax Rate Changes, which will go into effect on July 1, 2019.

When are your IFTA taxes due?

The IFTA return due date for the 3rd quarter is October 31st. Take a look below for a list of IFTA fuel tax reporting for the each quarter.

  • 1st quarter (January to March) — April 30
  • 2nd quarter (April to June) — July 31
  • 3rd quarter (July to September) — October 31
  • 4th quarter (October to December) — January 31

Fuel Taxes: Free Estimate

Our Fuel Tax Specialists will give you a free estimate. They can also answer any questions you have on fuel taxes or reporting.

Review the 2019 1st quarter IFTA tax rates
Review the 2019 2nd quarter IFTA tax rates

IFTA fuel tax rate changes (2019)


In 2019 some states and provinces had changes in their IFTA fuel tax rates causing a split rate for the effected quarters. Two of those were Alberta—the Canadian province—and the state of Alabama.

The Alberta Treasury Board and Finance, Tax and Revenue Administration (TRA), had a tax rate change for the 2nd quarter of 2019, which went into effect on May 30, 2019. Since the change fell in the middle of the quarter, Alberta will have a split rate for this quarter.

The Alberta Tax and Revenue Administration has requested that all jurisdictions honor this rate correction for the 2nd quarter fuel taxes.

The State of Alabama will also have a split rate, but during the 3rd quarter of 2019. Legislation was recently passed incorporating the tax rate change, which will go into effect September 1, 2019.

IFTA Tax Rates for 2019


Fuel Taxes: Free Estimate

Our Fuel Tax Specialists will give you a free estimate. They can also answer any questions you have on fuel taxes or reporting.

IFTA Fuel Tax Rates (2019 Q1)

IFTA Fuel Tax Rates | IFTA | CNS

The International Fuel Tax Agreement (IFTA) has released the 1st quarter 2019 fuel taxes.

When are your IFTA taxes due?

The IFTA return due date for the 1st quarter is April 30th. Take a look below for a list of IFTA fuel tax reporting for the each quarter.

  • 1st quarter (January to March) — April 30
  • 2nd quarter (April to June) — July 31
  • 3rd quarter (July to September) — October 31
  • 4th quarter (October to December) — January 31

Fuel Taxes: Free Estimate

Our Fuel Tax Specialists will give you a free estimate. They can also answer any questions you have on fuel taxes or reporting.

Review the 2019 2nd quarter IFTA tax rates.
Review the 2019 3rd quarter IFTA tax rates.

IFTA UPDATE: IFTA Credential Grace Period

IFTA Credential Grace Period


This Memorandum is being issued by IFTA (International Fuel Tax Association) in an effort to clarify the grace period. The IFTA Articles of Agreement, Section R655 provides:

R655 GRACE PERIOD

.100 Carriers from new member jurisdictions shall be allowed a two-month grace period from the date of the new member’s IFTA program implementation to display the IFTA license and decals. However, carriers must maintain the proper credentials for traveling in member jurisdictions until they display the valid IFTA license and decals.

.200 Carriers renewing their IFTA license and decals have a two-month grace period (January and February) to display the renewal IFTA license and decals. To operate in IFTA jurisdictions during this grace period, carriers must display either valid current or prior year IFTA license and decals from the jurisdiction in which they were operating or a valid single-trip permit from the IFTA jurisdiction in which they are operating.

Because there are no new member jurisdictions implementing the IFTA in 2018, R655.200 above is the applicable language for the grace period in 2019.

Carriers must display one or more of the following to travel through IFTA member jurisdictions for the first two months of 2019.

  1. A valid 2019 IFTA license and two IFTA decals issued by an IFTA member jurisdiction.
  2. A valid 2018 IFTA license and two IFTA decals from an IFTA member jurisdiction (if a renewal application has been filed for 2019); or
  3. A valid trip permit issued by the IFTA member jurisdiction through which they are operating.

Please be advised that IFTA License Renewals for 2019 MUST BE FILED WITH YOUR BASE JURISDICTION BEFORE THE END OF 2018. The two-month grace period is for display of renewal credentials, not to file your renewal application for those credentials (See R655.200 above).

In order to have a seamless operation into the new calendar year, we encourage you to file your renewal
application with your base jurisdiction well before December 31, 2018.

R630 of the IFTA Articles of Agreement provides:

Carriers renewing credentials may operate with the IFTA decals and license two months prior to the effective date shown on the credentials. However, those carriers are responsible for filing a fourth quarter report for the year preceding the effective date of the new credentials, including all operations for that quarter.


Fuel Taxes: Free Estimate

Our Fuel Tax Specialists will give you a free estimate. They can also answer any questions you have on fuel taxes or reporting.