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August 16, 2021

Tax proposal would charge drivers a fee for the miles they drive

If the Dutch government has its way, the cost of driving may be going up for those who spend most of their time behind the wheel.

Meter-2-popup1 A select group of cars in the Netherlands have been outfitted with meters designed to charge drivers a monthly fee for the kilometres they drive.

Aside from obvious costs like gas, the meter also factors in the cost to society in the form of pollution, traffic congestion, greenhouse gas emissions and wear and tear on roads, reports the New York Times.

Using the car's GPS and a wireless connection, the system tabulates a charge for each car trip by using a  formula that also takes account of a car’s fuel efficency, the time of day and the route (driving on less-traveled roads is cheaper). 

While still in the trial stages, the vehicle’s owner would receive a bill detailing times and costs of usage, not unlike a cellphone bill or the 407 ETR charges that GTA drivers now experience.

Currently shelved amidst political outcry, supporters of the meters contend that the charges wiould be equitable than current taxes like automobile purchase and registration fees since they reflect actual use rather than mere ownership.

That's similar to the thinking behind the pay-as-you-drive insurance programs that have already been instituted in several U.S. states.

Would you be ok with meters tracking everywhere you’ve driven? Or would their immediate feedback push you more quickly towards public transportation?

By Gordon Powers, MSN Money



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...