The Biden government is considering imposing a vehicle mileage charge on Americans – as a way of financing a multi-trillion-dollar infrastructure plan to be announced by President Biden, said Transport Secretary Pete Buttigieg on Friday.
“I think this is very promising … If we believe in the so-called user-pays principle, the idea that part of how we pay for roads you pay based on how much you drive,” Buttigieg told CNBC during an interview.
“The gas tax used to be the obvious way to do this; it is no more … So, a so-called mileage rate per vehicle or a mileage rate, as you want to call it, may be the way to do it. “
The fee would tax drivers on the number of miles they travel, as opposed to the amount of gasoline they consume, which is no longer a reliable stream of income with so many electric cars on the roads.
“I am listening to a lot of appetite to ensure that there are sustainable financing flows,” said Buttigieg.
“You are hearing a lot of ‘maybe’ here because all of these things need to be balanced and can be part of the mix,” warned the secretary, saying that the mileage rate is just a consideration at the moment.
Buttigieg later added that the White House is also considering bringing back Build America Bonds, which are a special type of municipal bond introduced by the Obama administration for the first time and which have interest costs covered by the US Treasury.
He said the bonds are “very promising in terms of how we leverage this type of financing”.
His comments came a day after the first press conference for the Biden presidency, where he announced plans to reveal a $ 3-4 trillion infrastructure account in Pittsburgh next week.
The president argued that rebuilding the U.S. physical and technological infrastructure was a key priority not only to boost a sluggish economy, but to remain competitive with foreign rivals like China.
Buttigieg said that a plan to rebuild the country’s roads, bridges and waterways would bring a significant return on investment.
“When you think about infrastructure, it is a classic example of the type of investment that has a return on that investment,” the former presidential candidate told CNBC.
“This is one of the many reasons why we consider this to be so important. This is a vision of jobs, as much as it is an infrastructure vision, a climate vision and much more. “
A day earlier, Buttigieg urged the Chamber’s Transport and Infrastructure Committee to make a “generational investment” to improve infrastructure and, at the same time, combat climate change and racial inequality.
“There is an almost universal recognition that a broader recovery will require a national commitment to repair and transform America’s infrastructure,” said the secretary.