California Considers Per-Mile Tax as EV Boom Threatens Billions in Lost Gas Revenue

As the number of electric vehicles (EVs) continues to surge across California, state leaders are grappling with a new economic challenge: how to replace billions in lost gas tax revenue.

By early 2024, California had registered more than 1.1 million EVs, the highest number in the nation. And while that’s a win for the environment, it’s a growing concern for transportation funding. EV owners don’t pay into the state’s gas tax, which generated an estimated $7.4 billion in 2022–2023 alone. Over the next decade, California could lose $6 billion in gas tax revenue.

To address the shortfall, the state is considering a California Road Charge—a mileage-based fee where drivers would pay by the mile, not the gallon.

The proposal sparked strong reactions during a recent discussion featuring contributors Stephanie Green and Tammy Black.

“This state is out of control,” said Green, CEO of FG Creative. “We’ve been paying insane gas taxes for years, and the roads are still a mess. Now they want to charge per mile? It’s just another way to drive people—and tourists—out of California.”

Tammy Black, owner of Sherlock Holmes Watch, raised questions about how such a system would be enforced. “How would a per-mile fee even be verified? I’d like to see how Caltrans’ pilot program worked before we rush into anything.”

Black suggested an alternative: “Why not tax the energy used by EVs in a similar way to gas? It’s still being used to drive on the roads.”

Both contributors expressed frustration over how current transportation taxes are allocated. “There’s a lot of tax money that doesn’t seem to be reaching the roads,” Green said. “Where is it going?”

Black added a pointed hypothetical: “What if everyone just walked? No gas tax, no per-mile fee. Then what?”

As California balances environmental goals with economic realities, the debate around how to fund infrastructure in a post-gas world is just getting started.

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