LOUISVILLE, Ky. — All across America, drivers are paying record high prices to fill their gas tanks. But not Mike Proctor. 

What You Need To Know

  • A bill moving through the Kentucky legislature would impose new taxes on electric vehicles

  • The taxes are meant to make up for the gas tax, which EV owners do not pay

  • EV owners fear the new taxes will kill EVs in their infancy

  • At least 30 states have similar registration fees for EVs

“We’re driving on sunshine,” said Proctor, who charges his Tesla and his wife’s Honda Clarity with power generated by the solar panels on his Richmond, Kentucky home. 

But a bill currently moving through Kentucky’s General Assembly would hit electric vehicle (EV) owners like Proctor with a new tax, which he fears would discourage EV adoption at the worst possible time.

“We would like to see the whole EV marketplace grow to maybe 10% of the cars on the road so that we don’t kill this thing in its infancy,” said Proctor, who serves on the board of directors for the EV advocacy group Evolve KY.

At the end of 2020, there were just under 2,700 EVs registered in Kentucky, according to federal government data. That’s fewer than 32 other states and a tiny fraction of the 3.5 million vehicles registered in Kentucky. 

“We’re just concerned that these taxes might slow the adoption of EVs,” Proctor said. 

The taxes that Proctor and other EV evangelists oppose are contained in House Bill 8, which passed out of the House last week. One provision of the bill would add a three cent per kilowatt hour tax to electric vehicle charging. That would mean a full charge on a 50 KW battery Tesla Model S would be taxed $1.50. 

Another provision of the bill would institute a $140 annual fee on the registration of electric vehicles and a $70 annual fee on hybrid vehicles.

At least 30 states have similar registration fees on EVs, according to the National Conference of States Legislatures. The annual fees range from a high of $225 in Washington to a low of $50 in Colorado, South Dakota, and Hawaii. Every state that borders Kentucky charges EV owners an extra registration fee. 

Rep. Jim Duplessis (R-Elizabethtown) explained on the House floor last week that the fees make up for the gas taxes EV owners avoid.

“As cars become more and more electrified, the cars that are driving on the roads aren’t buying gasoline to pay for the roads that they’re using, which will soon put a big damper on the states’ highway funds,” he said.

At present, every gallon of gas in Kentucky is taxed 26 cents. Most of that is directed into the state’s road fund, which covers costs associated with building and maintaining roads and bridges.

Given the small number of EVs in Kentucky, the new taxes would not generate much revenue. But they would correct what some see as an issue of fairness.  

“Electric cars still have wheels and they’re still on the roads and they still use the asphalt,” Rep. Jason Petrie (R-Elkton), the sponsor of House Bill 8, said. 

Proctor said he has no issue paying his “fair share.” But, he added, “The timing here is just awful.”