EV Taxes
As electric vehicles (EVs) gain market share and gas tax revenues decline due to improved fuel efficiency and electrification, states are reexamining how all drivers contribute to roadway funding. Because EVs do not pay motor fuel taxes (the primary source of transportation revenue), policymakers are exploring a range of approaches to ensure that they contribute equally to public funding for highways, bridges, and local roads. We believe EV drivers should pay their fair share through the adoption of fuel-neutral, equitable funding mechanisms rather than disproportionate taxes on EVs.
However, EV-specific fees and taxes are the approach that has gained the most momentum in recent years. These taxes and fees target local and out-of-state EV drivers who use in-state charging infrastructure. States are also evaluating how to fund the inspection, compliance, and regulatory oversight of expanding charging networks, as well as how to account for differences in vehicle weight and roadway usage, particularly for heavier commercial vehicles.
The array of policy tools that specifically target EVs for revenue collection—as well as alternative proposals for fuel-neutral funding mechanisms—is growing. This resource provides an overview of some of the leading proposals of each kind.
State EV Registration Fees
Across the country, most states have adopted additional registration fees for EVs. As of May 2026, 40 states charge some form of extra fee on EVs during annual registration, though the scope and scale of these fees vary. In seven states, the fees apply only to EVs. This group includes Hawaii, which signaled a shift in approach by planning to replace its EV fee with a vehicle miles traveled (VMT) program beginning in 2028. In 17 states, fees extend beyond EVs to include plug-in hybrid electric vehicles (PHEVs). Meanwhile, 16 states apply fees more broadly to EVs, PHEVs, and traditional hybrid vehicles (HEVs).
EV tax landscape as of May 2026
EV registration fee amounts vary widely by state. In 2025, light-duty EV fees range from about $50 to $250, with an average of roughly $150 and a most common fee of $200. By comparison, internal combustion engine (ICE) drivers typically don’t pay a flat annual fee. Instead, they contribute through state gas taxes at the pump, which usually total between $100 and $200 per year, depending on the rate set by the state, fuel efficiency, and miles driven. The key difference between EV drivers’ contributions to highway funding and ICE drivers’ is structure: EV fees are flat and paid upfront, while gas taxes are usage-based. That means many EV drivers, especially low-mileage drivers, often pay as much or more than ICE drivers, which is driving ongoing policy debate about fairness and long-term funding solutions.
Analysis shows that, in most states, EV drivers already pay more in state taxes and fees than ICE drivers. In 2025, somebody driving an EV 12,000 miles annually and relying solely on public charging stations paid more in combined state taxes and fees than they would have in a 35 MPG ICE vehicle in 36 states, including Washington, D.C. This highlights how current fee structures in many states may already place a comparable, or even greater, financial burden on EV drivers relative to their gasoline counterparts.
State Public Charging Taxes
A per-kilowatt-hour (kWh) fee is an emerging approach that taxes electricity dispensed at public EV charging stations, similar in concept to a traditional fuel excise tax. This model is designed to respond to declining gasoline tax revenues by linking roadway funding more directly to the energy consumed for vehicle travel, regardless of fuel type. In practice, these fees are typically limited to public or commercial charging stations, with residential charging generally excluded. The costs are usually passed through to EV drivers at the point of charging, collected by charging operators to be remitted to the state. The exact fee structure varies by state. Some jurisdictions apply a flat per-kWh rate, while others differentiate charges based on the type of charger used, such as Level 2 versus DC fast charging. As of May 2026, nine states tax public charging. Rates vary, and some differentiate between Level 2 and DC fast charging. Most states exclude residential charging, which makes drivers without access to home charging take on more of the burden.
Inspecting Taxed Chargers
As of May 2026, only a limited number of states address inspection requirements in EV charging-related legislation. Just four states include such provisions, with varying approaches. Georgia and Iowa assign oversight to their Departments of Agriculture, conducting inspections annually and biennially, respectively. Oklahoma allows for periodic third-party testing, while Kentucky permits inspections but does not require them. Montana considered inspections in an early draft but ultimately removed the language.
Where included, inspections add cost and complexity. States face challenges building inspection capacity, developing and procuring equipment, and avoiding implementation delays, as seen in Georgia, which postponed its tax rollout twice. At current frequencies, inspections appear primarily focused on meter calibration rather than charger uptime or performance.
Of the states that have established weights & measures (W&M) permit fees for EV charging devices, annual permit fees are as follows:
- California: $26 per device (maximum $1,200 per business location). Although W&M device registration is handled at the county level in California, the State’s Business and Professions Code, Division 5, Article 2.1, Section 12240 (t) sets the maximum fee amount per device.
- Connecticut: $50 per public charger.
- Florida: $100 per device.
- Texas: $30 per port.
- Vermont: $25 per connector plug.
- Washington: $20 per Level 2 port; $40 per DC fast charge port.
- Maryland: $150 per port (fee set to be active July 2026)
Vehicle Miles Traveled (VMT) Programs
VMT programs have been explored as a longer-term, fuel-neutral funding solution. The Infrastructure Investment and Jobs Act provided funding for both state and national VMT pilot programs, though the national pilot has faced significant delays, with an advisory board only established in December 2024. While House Transportation and Infrastructure Committee Chairman Sam Graves (R-MO) has historically supported exploring VMT approaches, he has indicated that such policies are unlikely to be included in the upcoming surface transportation bill. Instead, simpler flat-fee approaches have gained traction in Congress, in part due to their relative ease of implementation.
In 2026, four states are offering an alternative approach to traditional vehicle fees by allowing EVs and, in some cases, other vehicles to opt into programs that charge based on miles driven. These VMT programs are designed to give drivers the option to reduce or avoid fixed registration surcharges.
Hawaii launched its program on July 1, 2025, allowing enrolled EV drivers to opt out of the $50 annual registration surcharge, with plans to fully phase out the fixed fee option by July 2028. Oregon’s program extends to both EVs and fuel-efficient vehicles, enabling participants to avoid a variable registration surcharge, while drivers of traditional internal combustion engine vehicles may receive a fuel tax credit. In Utah, enrolled EV drivers can avoid a $143.25 registration fee surcharge, and in Virginia, participating vehicles are exempt from a variable highway use fee. Hawaii, Utah, and Virginia have structured these programs so that mileage-based charges are capped at the state’s annual fee amount. This ensures that participants cannot end up paying more than they would under the standard fee structure, ensuring that the program functions as a potential cost-saving option rather than an added expense.
A National EV Tax?
Previous Proposals
Federal proposals in 2025 and 2026 have focused on implementing new annual registration taxes for EVs as part of broader transportation funding discussions. A House GOP budget reconciliation proposal introduced in 2025 included a $250 annual fee for EVs and a reduced $100 fee for plug-in hybrid and hybrid vehicles. Under this framework, states would be responsible for administering the fee and would receive $2 million annually to support implementation and administrative costs.. Early versions of the budget reconciliation effort included a temporary $20 annual registration fee for ICE vehicles, though this provision was ultimately removed in later iterations.
Federal policymakers also considered a one-time EV tax through the Fair SHARE Act, introduced by Senator Deb Fischer (R-NE) and Representative Dusty Johnson (R-SD). The proposal called for a $1,000 fee on EVs at the point of sale, plus an additional $550 per 1,000-pound battery module for light-duty vehicles under 8,500 pounds, with the revenue directed to the Highway Trust Fund. The measure has garnered support from organizations such as the American Trucking Associations, the American Society of Civil Engineers, and the National League of Cities, among others.
Current Proposal
The Surface Transportation Reauthorization proposal, released in May 2026 includes a revised federal fee structure under Section 1129. The proposal establishes an annual EV registration fee beginning at $130 in FY2027, increasing by $5 every two years until reaching a maximum of $150 in FY2035. Plug-in hybrid electric vehicles (PHEVs) would begin with a $35 annual fee that gradually increases to $50 by FY2033. Both fee structures would remain capped and would not be indexed to inflation. While this policy is projected to generate approximately $30 billion over 10 years, estimates suggest this would address less than 15% of the roughly $280 billion projected shortfall in the Highway Trust Fund. On average, drivers of gas-powered cars currently contribute roughly $70–$90 per year in federal fuel taxes, collected at the pump through an 18.4 cent-per-gallon federal gas tax. Under the $130 starting value of the proposed new tax, EV drivers would pay approximately 45% more.
Like previous proposals, states would administer the program through existing vehicle registration and renewal systems, primarily using DMV processes or federally approved alternatives. States could retain up to 1% of revenues for administrative costs. States would need to implement the program by October 1, 2027, potentially requiring new systems, legislative changes, and additional resources. The proposal also includes strict compliance requirements. States must remit collected revenues to the federal government, and noncompliance could result in the Federal Highway Administration (FHWA) withholding 125% of the amount owed. FHWA would also conduct a study two years after implementation to evaluate administration and operational challenges, reflecting continued uncertainty around how the program would function in practice. As of May 2026, a proposal to address the Highway Trust Fund’s insolvency has not yet been passed by Congress.
To recap, the Highway Trust Fund has been insolvent for decades, largely because the federal gas tax has not been raised or indexed to inflation since 1993, while fuel efficiency has increased steadily. The broken way in which U.S. transportation infrastructure is funded is a critical issue that requires a holistic overhaul, but EV fees are neither a fair nor a complete solution. For more on why, read our policy resource EV Taxes: Road Funding’s Red Herring.