California Driving Tax: Per-Mile Rate, Reporting, and Privacy

The California driving tax is not a tax anyone currently owes. It’s the shorthand name for a voluntary road charge pilot that bills participants roughly 2.8 cents for every mile driven, with credits for the gas taxes or electric-vehicle fees they already paid. The state is testing it as a possible long-term replacement for the gasoline excise tax, and a final report to the Legislature is due by December 31, 2026.¹ Until the Legislature acts on that report, no California driver is required to pay a per-mile fee.

Why California Is Looking at a Per-Mile Fee

Road maintenance in California is funded largely by the state gasoline excise tax, which sits at $0.612 per gallon as of July 2025.² As cars get more efficient and more drivers switch to electric, fewer gallons move through the pumps and less revenue reaches the state. An EV driving 12,000 miles a year contributes nothing in gas tax but puts the same wear on pavement as any other car.

A per-mile charge ties revenue to road use rather than fuel purchases. That’s the structural fix the pilot is testing. The policy questions are whether the system can be made accurate, cheap to run, and acceptable to drivers who are wary of being tracked.

Do You Have to Pay It Right Now?

No. The road charge is voluntary and limited to pilot participants. Every California driver still pays the gas tax at the pump, and EV owners still pay the $121 annual zero-emission vehicle registration fee.³ The most recent collection phase ran from August 2024 through January 2025, and Caltrans actively recruited owners of fully electric cars, plug-in hybrids, and high-efficiency gasoline vehicles because those groups pay the least in gas taxes relative to the miles they drive.⁴

Participants were split into two pricing groups. One paid a flat per-mile rate identical for every vehicle. The other paid an individually calculated rate equal to the state gas tax divided by their vehicle’s EPA fuel-economy rating, so less efficient cars paid more per mile and more efficient ones paid less.¹ Comparing those two approaches is one of the pilot’s central research questions.

How the Rate Works

The flat-rate group in the most recent pilot paid 2.8 cents per mile, a figure that includes administrative costs.⁵ At that rate, 1,000 miles in a month comes to $28. An earlier phase used 2.5 cents per mile, so the number has shifted once already and would likely be recalibrated before any permanent rollout.

Under the individually calculated version, a car rated at 30 MPG pays about 2.04 cents per mile ($0.612 ÷ 30). A plug-in hybrid rated at 50 MPG pays roughly 1.22 cents. The approach mirrors what each vehicle would have contributed through the gas tax if every gallon were taxed at the pump.

What You’d Actually Pay Compared to the Gas Tax

The road charge doesn’t stack on top of what you already pay. Participants receive a credit for the state gas taxes paid at the pump, calculated from their vehicle’s fuel-economy rating and the miles they reported. Drive 1,000 miles in a 30 MPG car and the system estimates you bought about 33 gallons and paid roughly $20.40 in state gas tax, which is subtracted from your road charge invoice.⁴

EV owners don’t buy gasoline, so they instead receive a prorated refund of the $121 annual ZEV registration fee.¹

Here’s how that works out at the 2.8-cent flat rate, assuming 1,000 miles driven per month:

A sedan rated at 30 MPG currently pays about $20.40/month in state gas tax. Road charge: $28 minus the $20.40 credit, a net increase of roughly $7.60/month.
A plug-in hybrid rated at 50 MPG currently pays about $12.24/month. Road charge: $28 minus $12.24, a net increase of about $15.76/month.
A fully electric vehicle currently pays $0 in gas tax but owes $121/year, or $10.08/month, in ZEV registration fees. Road charge: $28 minus the $10.08 credit, a net increase of about $17.92/month.
A truck rated at 18 MPG currently pays about $34/month in gas tax. Road charge: $28 minus $34 in credits, meaning the driver owes nothing additional and might receive a small refund, depending on how the final credit system works.

The pattern is consistent. Drivers of fuel-efficient and electric vehicles would pay more under a road charge, while owners of less efficient vehicles could break even or come out ahead. That is the shift the state is weighing: tying infrastructure contributions to miles driven rather than gallons burned.

How Miles Would Be Reported

Participants pick from several methods:⁴

Manual odometer entry. You photograph or type in your odometer reading at the start and end of a reporting period. No device, no GPS.
A plug-in device that connects to your car’s OBD-II port and records miles automatically. Some versions include GPS; others don’t.
In-vehicle telematics, which uses software already built into newer vehicles to transmit mileage data. Available with or without GPS.

GPS-enabled options can distinguish California miles from out-of-state miles, which matters if the state eventually wants to charge only for in-state travel. Non-GPS options record total miles regardless of location. How to handle out-of-state driving in a permanent system is one of the open policy questions.

Privacy Rules

Location tracking is the obvious concern, and the original 2014 authorizing law addressed it directly. The program is prohibited from reporting travel locations or patterns and must apply both legal and technical safeguards to personal data.⁶ Specific requirements include:

Only the personal information necessary to run the program may be collected.
Personal data cannot be sold, distributed, or provided to any private entity or individual. Government access requires a court order, subpoena, or search warrant.
At least one reporting method must work without electronic location data, so no driver is forced into GPS tracking.
Processes must govern how data is collected, stored, transmitted, and destroyed.

These rules carry over into the current collection pilot. Whether they’re enough to satisfy skeptical drivers is a separate question from what the law requires.

When a Decision Could Come

The collection phase is finished and the state is analyzing results. The final report to the Legislature is due by December 31, 2026, and the law authorizing the pilot sunsets on January 1, 2027, unless lawmakers extend it.¹ That makes 2027 the earliest a permanent road charge could be enacted, and realistically it would take additional legislation and a phased transition. If the program does eventually become mandatory, the transition will almost certainly include credits to prevent drivers from paying both the road charge and the gas tax at the same time, as the pilot does now.

1
LegiScan. Bill Text CA SB339 2021-2022 Regular Session Chaptered
2
California Department of Tax and Fee Administration. Fuel Taxes – Tax Rates
3
California Department of Motor Vehicles. Registration Fees
4
Caltrans. Caltrans Seeks Volunteers for Road Charge Pilot
5
California Transportation Commission. Update on the Pilot Road Charge Rate for 2024-2025
6
California Legislative Information. SB 1077 Senate Bill – Chaptered