Proposal would impose a national $250 annual fee on electric vehicles (EVs) and a $100 fee on hybrid passenger vehicles and be deposited into the Highway Trust Fund (HTF).

On April 30, the House Transportation and Infrastructure Committee voted to advance a proposal that would impose a national $250 annual fee on electric vehicles (EVs) and a $100 fee on hybrid passenger vehicles. The initiative, spearheaded by Chairman Sam Graves (R-Mo.), aims to address the shortfall in funding for roads and bridges due to EVs not contributing to the Highway Trust Fund (HTF). AGC has long advocated for the inclusion of such fee and thanked the committee for their leadership on the issue.

The proposed EV fee is projected to generate billions in highway funds over ten years. While it would still fall short of filling the revenue gap in the HTF, it would mark the first increase in user-fees since 1993.

The proposal initially included a $20 annual registration fee on all vehicles, but faced internal opposition from Republican lawmakers, and was ultimately withdrawn from the broader proposal. Chairman Graves later clarified that the inclusion of the fee was intended to start a conversation about the need for additional revenue for the HTF.

The proposed EV and hybrid fees are part of a broader proposal that would also increase funding for the Coast Guard, improve the Federal Aviation Administration’s (FAA) traffic control systems, and remove unobligated funds from certain programs focused on low carbon materials created under the Inflation Reduction Act.

For additional information, please contact Deniz Mustafa.