Wisconsin DOT Budget Proposes Increased Taxes and Fees for Hybrid Owners and Diesel Users

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One of the incentives of buying a hybrid car, besides the attractive fuel economy and environmental friendliness, is that purchasing a new hybrid vehicle can come with federal tax benefits of up to $3,400. This benefit, however, has the chance of being undercut by tax increases proposed by the Wisconsin Department of Transportation.

According to the Star Tribune, the Department of Transportation budget, which was submitted last Friday, outlines a few different tax and fee increases, which together amount to an estimated $751 million. According to Finance and Commerce, the tax increases would help close a budget gap of about $680 million.

The measures in the budget are described by DOT Secretary Mark Gottlieb as “ambitious and far-reaching,” and will be implemented over the next two years if the budget is passed. One of the proposed tax increases includes a $50 annual fee for electric and hybrid vehicles — “to ensure these owners continue to pay their fair share of the operating costs of our infrastructure,” according to Gottlieb.

Other parts of the proposal include a fee on the purchase of new vehicles (amounting to about $800 on a $32,000 vehicle), a gas tax of five cents a gallon, and a diesel tax of about 10 cents a gallon.

The extreme budget measures stem from a huge DOT deficit and, according to the executive director of the Wisconsin Counties Association and the Transportation Investment Coalition John Gard, a recognition that the current financing resources for transportation in Wisconsin “will not meet the long-term needs” of the network.

The budget was submitted to Wisconsin Governor Scott Walker a little over a week after his reelection, but it still has a ways to go before it can be passed. The budget will be considered when Walker compiles his budget proposal for all of Wisconsin’s operations. Then, it will likely see amendments from the Legislature, before being passed in June.

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