Arrival of Electric Cars Will Force Gov'ts to Adapt Alternative Taxes

Canada's three levels of government share about $15 billion in taxes from fuel annually.

Published: 20-Jan-2010

MONTREAL — The eventual popularity of electric cars will force governments to consider alternative revenues as they prepare to wean themselves off fuel taxes, industry observers say.

Canada's three levels of government share about $15 billion in taxes from fuel annually. But some of that revenue could be at risk if consumers turn en masse to plug-in electric or hybrid vehicles.

"What is being talked about is taxes on electricity, taxes on other modes of transportation like highway tolls," said Al Cormier of Electric Mobility Canada.

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The range limitations of most early electric cars will matter less in tightly packed urban areas, where the daily driving distance is likely to be much shorter than in the suburbs or rural areas.

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