The auto industry’s top trade group is telling Washington it is time to pull the plug on the federal gas tax. The Alliance for Automotive Innovation is urging Congress to scrap the long‑standing 18.4¢ per‑gallon levy and replace it with a single, weight‑based fee on every vehicle, collected like an annual registration charge. The group is pitching the swap as a way to shore up the Highway Trust Fund as more drivers move into electric and increasingly fuel‑efficient cars, which chip away at per‑gallon tax receipts. Alliance leaders argue that a registration‑style fee would ensure every vehicle pays into road and bridge upkeep, and the proposal arrives as drivers face higher gas prices and lawmakers haggle over a multi‑year transportation bill, as per the Alliance for Automotive Innovation.
In an April 1, 2026 blog post, Alliance president and CEO John Bozzella laid out the plan and argued that a weight‑based registration fee would be “straightforward” and “easy to collect.” In the post for the Alliance for Automotive Innovation, he wrote, "Congress should dump the gas tax once and for all."
Why the Industry Says It Is Necessary
The Highway Trust Fund leans heavily on the federal gas tax of 18.4¢ per gallon, which the Federal Highway Administration notes was last raised in 1993. Industry officials and analysts say that rising EV adoption and better fuel economy have steadily eroded both receipts and the tax’s real buying power; Reuters has reported that the gas tax has lost a large share of its value once inflation is factored in.
How the Fee Would Work and the Politics
Bozzella is floating a weight‑based fee collected at vehicle registration as a simpler alternative to a per‑gallon excise. The Alliance counts major automakers and suppliers among its members, including General Motors, Toyota, Volkswagen and Hyundai, according to the Alliance for Automotive Innovation. Turning the concept into law would require Congress to spell out a formula, collection rules and any exemptions, a process that is both technically complicated and politically touchy.
Critics Say EV Fees Could Be Unfair
EV advocates and policy groups counter that a flat per‑vehicle charge could wallop electric‑vehicle owners harder than drivers who still pay at the pump. In a letter to the House Transportation and Infrastructure Committee, the Electrification Coalition called a proposed $250 annual EV registration tax “excessive,” pointing out that a typical gas‑powered driver pays roughly $88.32 per year into the Highway Trust Fund at the current federal rate. The group urged technology‑neutral fixes and warned against penalizing early EV adopters while the fund’s deeper structural problems are sorted out.
What Comes Next
The Alliance’s push lands as Congress works on a multi‑year surface‑transportation package. Reuters reported that lawmakers have repeatedly propped up the trust fund with one‑time cash infusions, including about $118 billion tied to the 2021 infrastructure law and more than $275 billion shifted from the general fund since 2008. If Congress takes the industry’s idea seriously, upcoming fights over fairness, price signals and how to phase in any changes will decide whether this proposal stays on a trade‑group wish list or actually makes it into statute.
