Iowa's gas tax revenue slumps as EVs gain momentum

Iowa's gasoline taxes are making up a smaller share of the state government's revenue, according to new data from the U.S. Census Bureau.

Why it matters: The collections help pay for critical road repairs, which have faced millions of dollars in annual shortfalls for years.

• Iowa last year launched a new electric vehicle tax of $.026 per kilowatt hour at public charging stations to help offset the decline of fuel tax revenue as the EV market grows.

Stunning stat: Iowa's motor fuel tax revenue was just over $601.2 million last year — that's down 16%, or more than $108 million, from 2022 and the lowest amount collected since before the pandemic, per census data.

• The tax generated just over $684 million in 2019.

Meanwhile, the state's Legislative Services Agency estimates Iowa's electric vehicle tax will collect $160,000 in its first fiscal year that ended last month.

The big picture: Other states and Congress are taking note of the looming struggle to replace gas tax revenue as fossil fuel usage declines in the renewable energy transition.

• Republican states are leading the way in charging higher EV taxes and it's prompting pushback from industry groups and drivers, the Wall Street Journal reports .

Go deeper: Iowa's elusive electric mile