This paper considers how to set road-user taxes most efficiently within the constraint that user payments must cover road expenditures. The charges levied on different vehicle classes are required to cover at least the maintenance expenditures incurred because of use by those classes. Four policies for determining an extra charge or markup sufficient to balance the budget are evaluated-the vehicle-kilometer proposal, the ton-kilometer proposal, the imputed-gross-revenue proposal, and the inverse-elasticity proposal. For 1969, the vehicle-kilometer proposal suggests the least change from present policy, followed by the ton-kilometer, the imputed-gross-revenue, and the inverse-elasticity proposals respectively. The inverse-elasticity basis suggests especially higher payments from heavy vehicles than were collected. The inverse-elasticity proposal uses estimated responsiveness of demand to price changes to place heavier burdens where the reduction in use would be relatively less. The other three methods refer to various output measures for apportionments of tax burdens among vehicles. On the criterion of efficiency, the proposals are ranked inverse elasticity, imputed gross revenue, ton kilometer, and vehicle kilometer in descending order. However, on the criterion of availability and quality of information required and difficulty of implementation, the proposals are ranked in the opposite order. Consequently, the radical revision in payment structure suggested by the inverse-elasticity proposal should be regarded only as a desirable direction of change. Much more precise analysis would be necessary to suggest a detailed structure for tax revision. /Author/

Media Info

  • Media Type: Print
  • Features: References; Tables;
  • Pagination: pp 35-40
  • Monograph Title: Transportation finance and charges, programming, and costs
  • Serial:

Subject/Index Terms

Filing Info

  • Accession Number: 00196590
  • Record Type: Publication
  • ISBN: 0309028256
  • Files: TRIS, TRB
  • Created Date: Aug 28 1979 12:00AM