Proposed Texas Senate Bill 1728 (SB 1728) will make Tesla and EV owners pay an additional $200 EV tax if passed. The claim is that EV owners need to “pay their fair share” and “make up for” fuel taxes they don’t pay that support the state’s road and transportation infrastructure. Now, this may sound reasonable at first glance, but this is indeed punishing Tesla owners and other EV owners for choosing to drive electric instead of with dirty internal combustible engines (ICE).
Gail Alfar with the Tesla Owners Club of Austin told me that Tesla has opposed the current proposals in each of their respective communities. Tesla isn’t the only one. Other OEMs and EV allies have also opposed it, but there is significant pushback from those on the other side.
Gail also shared with me that there are two other House Bills — 427 and 2986 — which are also in the House Transportation committee pushing for the same thing.
— Tesla Owners of Austin (@AustinTeslaClub) April 28, 2021
Some Things To Consider
EV owners contribute to state revenues today through registration fees, tolls, and taxes on the electricity that they use. That’s right — they already pay an electricity tax. So, the new $200 will be an additional fee that is only for EV owners.
This isn’t all. According to the Texas Advanced Energy Business Alliance, legislation has been proposed in Texas that would impose unreasonable flat fees that total up to $300 per year. These fees are much higher than what an efficient ICE vehicle owner would pay at the gas pump in taxes. “This creates an unreasonable tax burden on EV owners and picks technology winners and losers.”
Also, gasoline and diesel vehicles emit a ton of pollution, which causes cancer, asthma, heart disease, lung diseased, and other problems, sometimes even leading to premature death. These are large societal costs that EVs help avoid. The same goes for climate change, and at a similar scale of harm. These costs are not rolled into the cost of gas/diesel-powered vehicles but should be. It’s a clear market failure that these are not contributing to the market pricing of those vehicles. EVs at least help to reduce that “social tax.”
Texas Makes It Hard For Tesla & EV Owners To Buy An EV
Texas residents can still buy a car from Tesla through its website, but the purchase is handled as an out-of-state transaction and it has to be completed before the vehicle ships to Texas. This even applies to the coming made-in-Texas Cybertruck unless something changes soon.
The Tesla Cybertruck and other Tesla vehicles made in the Austin Gigafactory will have to be shipped out of state before being sold in Texas. This is nuts. Unless Texas changes the law that prohibits Tesla and auto manufactures from selling new vehicles to buyers without using a franchised dealership, EV buyers will have to jump through some hoops just to get their Texas-produced vehicles.
Now the state wants to add more to that hassle by making them pay an EV tax which is added to the taxes they pay on electricity, registration, and other fees. Texas is on the verge of punishing Tesla and EV owners for buying EVs.
Despite the fact that Tesla’s decision to build the Gigafactory in Austin will bring jobs to the area, Texas still has a bias against clean energy and EVs. This bias is clearly rooted in old money and fossil fuels.
How Tesla & EV Owners In Texas Can Fight Back
The Tesla Owners Club of Austin provided a template that you can use to contact your state representative regarding the proposed fee. You can adjust that template to your own wording or use it as is. If you are not sure who your Texas representative is, you can click here to find out.
One of the goals of the Texas Advanced Energy Business Alliance is to accelerate EV deployment in Texas by tackling market barriers to reduce the upfront cost of vehicles while promoting customer choice. The organization pointed out that electrification provides many benefits to Texas and state policy should promote new market development instead of creating market barriers. EVs make up a small portion of the number of vehicles on the road in Texas and have the potential to contribute very little to state revenues. However, imposing unfair flat fees will stifle market development and tax EV drivers unfairly for making the choice to drive a vehicle that doesn’t put out greenhouse gases from the exhaust pipe.
The members of the House Transportation Committee would benefit from hearing the thoughts of Tesla and EV owners in Texas. If you are one, you can look up who your House members and Senators are here. The governor’s office also has a website communication form and Tesla and EV owners can fill that out here.
The Myth That EV Owners Don’t Pay Their Fair Share Is Harmful
The truth is that the fossil fuel industry wants you to think EV drivers are just rich a-holes who get away from paying taxes by driving electric. Their paycheck depends on the average consumer believing this. This helps them in 2 ways.
- People buy ICE cars thinking EVs are out of their price range.
- Dealerships make money by being middle men and servicing vehicles.
Many people think that buying a Tesla costs a hundred thousand dollars or so. Jeremy Judkins, a Tesla owner who is popular on Twitter, has gotten on TikTok to help debunk this myth. In this video below, Jeremy shows how much a Tesla Model 3 SR+ costs. Check it out.
— Johnna Crider (@JohnnaCrider1) April 28, 2021
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