Michigan has approved new vehicle registration fee increases for electric and plug-in hybrid cars as part of a broader effort to overhaul its road funding system, a move that could make owning an electric vehicle more expensive for drivers in the state.
The changes follow Michigan’s decision to eliminate the sales tax on gasoline and replace it with an equivalent increase in the state’s fuel tax. While the shift leaves gasoline vehicle owners paying roughly the same overall amount, the adjustment automatically triggers additional registration fees for electric and plug-in hybrid vehicles under state law.
See also: Michigan Expands Clean School Bus Fleet with $35.9 Million in New Grants
According to MLive, the new structure adds $5 to the annual EV registration fee and $2.50 for plug-in hybrids for every one-cent increase in the gas tax. As a result, registering an electric car in Michigan will now cost drivers an additional $100 per year, raising the total fee to about $260, while electric truck owners will pay around $360.
Industry groups have criticized the changes, warning that they could discourage EV adoption. The Michigan Energy Innovation Business Council said the state’s new fees are now among the highest in the country and could send the wrong signal to automakers about Michigan’s commitment to transportation electrification. The group also noted that EV owners already pay more in state taxes on average than drivers of gasoline vehicles, despite typically driving fewer miles annually.
See also: Michigan Court Revives Lawsuit Over Ford’s BlueOval Battery Park Project
Lawmakers are reportedly considering a proposal to lower fees for electric and plug-in hybrid vehicles, but it remains unclear whether the measure will move forward.
