Many Americans seem to have a negative impression of charging drivers based on how much they use the roads. When asked by survey researchers about possible future highway funding sources, only one quarter of the public view MBUFs as a good idea. One reason for this is likely privacy concerns — some easily accessible articles suggest that the government might mandate a device in every vehicle that “tracks” when and where someone travels, which some characterize as “Big Brother in your car.” It is difficult to interpret these concerns considering most drivers already allow their movement to be logged or shared to some degree by their own vehicle’s electronic systems, as well as their insurance company and smart phone applications.
Interest groups focused on preventing unwarranted tax increases tend to have an additional concern: that a per-mile charge would be levied on top of the fuel taxes taxpayers already pay. This concern is understandable given the history of taxation in the United States, where taxes rates can be raised quickly and where new taxes rarely replace existing ones. For instance, the original top marginal income tax rate was only 7% when it was first levied in 1913. Only five years later it was increased to 77%. Further, some have proposed that an MBUF be used to discourage driving — set at such a costly rate that drivers will opt not to use their vehicles. Americans who appreciate the freedom made possible by cars and driving might see the switch from a fuel tax to an MBUF as a threat to their mobility.
Perhaps in reaction to these types of concerns, MBUFs may not be a regular feature of policy discussions about the future of road funding in Michigan. The 2017 fuel tax increase and subsequent indexing of it to inflation may be viewed by some policymakers as a sufficient solution to road funding concerns. The historic defeat — 80% voter disapproval — of former Gov. Rick Snyder’s 2015 plan to raise taxes for more road funding may still be fresh on the lawmakers’ minds. This memory combined with the failed attempt by Gov. Gretchen Whitmer to raise the gas tax by $0.45 per gallon in 2019 likely left little appetite among Michigan policymakers to consider new road funding sources.
A number of other states are experimenting with MBUF programs. Many of them address the concerns that people appear to have around protecting their privacy. Nearly all pilot projects:
- Give participants a choice of several methods to record their miles traveled and choice of how those miles are reported to the government.
- Do not “track” or report the time and place of trips made.
- Use private companies to handle the reporting of miles to the government.
- Use stringent privacy protections for mileage information collected.
- Make clear that the MBUF would replace the state fuel tax by accounting for what participants would have paid in fuel taxes for the miles driven.
Several of the pilot projects actively recruited public officials to be among the participants, which gave those officials firsthand experience with how the MBUF worked and how it compared to their expectations. In general, most participants in the pilot projects came away with a positive view of the switch to an MBUF.
Of course, the vast majority of Americans have not participated in such a pilot program and may remain skeptical about MBUFs. This skepticism may be fueled by the fact that some state departments of transportation and policymakers have focused solely on using MBUFs to fix an impending fuel-tax revenue shortfall rather than supporting the overall benefits of transitioning to such a program. When taxpayers hear that the government needs more revenue, they understandably tighten their grip on their wallets. This is particularly true in Michigan, following the 2017 fuel tax increase and the subsequent proposed tax increase in 2019. Nevertheless, there are several advantages to replacing fuel taxes with a MBUF system that policymakers should consider.
 Asha Weinstein Agrawal, Hilary Nixon and Ashley M. Hooper, “Public Perception of Mileage-Based User Fees” (Transportation Research Board, 2016), https://perma.cc/6XTS-4RHR.
 For example, see Katy Grimes, “Big Brother in your car?” (CalWatchdog.com, April 8, 2010), https://perma.cc/X89G-V4Q2.
 For example, see Carl DeMaio, “New Tax on Your Mileage,” email blast to California taxpayers, May 22, 2019.
 “Historical Highest Marginal Income Tax Rates” (Tax Policy Center, Feb. 4, 2020), https://perma.cc/BWL6-Y9UK.
 Paul Egan and Kathleen Gray, “Michigan Voters Soundly Reject Proposal 1 Road Tax Plan” (Detroit Free Press, May 5, 2015), https://perma.cc/Z5ZT-V99P.
 Kathryn Jones and Maureen Bock, “Oregon’s Road Usage Charge: The OReGO Program, Final Report” (Oregon Department of Transportation, April 2017), chapter 8, https://perma.cc/HK5U-34G5.