Texas enacts law requiring $200 yearly payment for EV owners

Texas Governor Greg Abbott has enacted a legislative measure that imposes a $200 annual fee on all electric vehicle (EV) owners in the state. Starting from September 1, the law will also mandate new EV owners to pay a one-time registration fee of $400, in addition to the yearly toll of $200.

The primary objective of this legislation is to recover some of the tax revenue lost by the state due to EV owners not purchasing gasoline, which typically incurs taxes when refueling at gas stations.

To illustrate, traditional taxes levied on gas-fueled vehicles are not applicable to Tesla owners, as their vehicles do not rely on gasoline. These fees collected by Texas are allocated for road and highway maintenance, as well as occasional investments in school improvements.

With over 200,000 EVs already on Texan roads and an additional 30,000 EVs anticipated this year, the legislation is estimated to generate approximately $38 million annually for the state’s highway repair fund.

Consumer Reports has raised concerns about the new annual fee of $200 proposed by Governor Abbott, deeming it excessive. According to their analysis, a fee of $71 would be the “maximum justifiable EV fee” in Texas.

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