Kentucky Releases New Law that Will Tax Electric Cars Twice as Much as Gas Cars

By: Mikaila Storrs | Published: Jan 08, 2024

Starting Jan. 1, the cost of owning an electric vehicle in Kentucky has increased due to introducing two new taxes. 

These taxes are now higher than those applied to vehicles that are run with gas. 

Eco-Friendly Vehicles Are Now Being Taxed More than Gasoline-Powered Vehicles

The new taxes on eco-friendly vehicles are part of a larger pattern globally by taxing these eco-friendly vehicles.

Charger Being Plugged Into Electric Vehicle

Source: CHUTTERSNAP on Unsplash

While their gasoline-powered counterparts that cause more harm to the environment continue to be taxed less. 

Electric Vehicle Owners Willl Pay Annual Fee

Electric vehicle owners in Kentucky are now required to pay an additional annual registration fee of $120.

Electric Scooter Being Plugged Into Charger

Source: Ather Energy on Unsplash

The tax will also be added to hybrid cars (gas and electric) and electric motorcycles. Both motorcycles and hybrid vehicles will be charged an annual $60 fee.

Public Electric Vehicle Charging Stations Will Now Charge 3 Cents Extra

In addition, electric vehicle charging stations that are available to the public in Kentucky will now charge 3 cents extra per kilowatt hour of charging.

Public Charger Being Plugged Into Electric Vehicle

Source: Michael Fousert on Unsplash

With this proposed 3-cent tax, EVs would be paying road tax at a rate almost four times what gas and diesel drivers are paying. That’s because Kentucky’s gas tax is 28 cents, and an equivalent amount of energy for an EV car would be taxed at 99 cents.” (courier journal)

3 Cent Additional Public Charging Fee Will Impact Apartment Residents

Additionally, chargers that are used on state property are subject to an additional 3 cents fee. 

Electric Vehicle Charger In Parking Lot

Source: Ernest Ojeh on Unsplash

This recently imposed tax could most impact commuters and apartment residents who rely heavily on public charging stations.

Will Electric Vehicles Become too Expensive for Renters?

It may lead to electric vehicles becoming too expensive for those who rent apartments. 

Charger Being Plugged Into Electric Vehicle

Source: Eren Goldman on Unsplash

But could still be cutting costs for those who own a home and are using their chargers on their electric bill with no taxes applied.


The Electric Vehicle Tax Was Implemented to Cover Repairs

The tax was implemented to cover road repair as electric vehicle owners don’t pay a gas tax, they don’t currently contribute to these costs.

Sidewalk Closed, Road Closed, Road Construction

Source: Robert Linder on Unsplash

In reality, the state pays for most of these repairs, and gas customers only make up a small percentage of the funds towards road costs. (via electrek)


Diesel Semi-Trucks Are the Leading Cause of Road Damage

Diesel semi-trucks are the leading cause of road damage, rather than gas or electric cars.

Yellow Semi Truck

Source: Wikipedia

Annually, the damage of an average electric vehicle is tens of thousands of times less than that of a semi-truck.


Sharing the Road Means Sharing the Cost to Maintain Them

State Highway Engineer James Ballinger shares his thoughts on the new electric vehicle tax. 

Electric Vehicle Tax Information

Source: @KYTC/ X

“Sharing the roads also means sharing the cost to maintain them,” said KYTC State Highway Engineer James Ballinger


New Kentucky Taxes Were Passed through House Bill 360

These new taxes were passed through House Bill 360 in the 2023 Kentucky General Assembly session.

Electric Car Plugged Into Charger

Source: Wikipedia

 “At the time of initial registration, and each year upon annual vehicle registration renewal, the county clerk shall collect, as required under KRS 186.050, from the registrants of electric motorcycles, electric vehicles, and hybrid vehicles the electric vehicle ownership fees,” says House Bill 360.


Over 9,000 Electric Vehicles in Kentucky

The U.S. Department of Energy reported 7,560 electric vehicles registered in Kentucky in 2022.

Red Tesla Parked

Source: Wikipedia

In December of 2023, the state reported that they now have more than 9,000 registered electric vehicles.


Victoria, Australia Previously Tried to Implement an EV Tax on Its Residents

This is not the first time we’ve seen something like this done with electric vehicles. Victoria in Australia previously implemented a charging fee of up to 2.8 cents for every kilometer traveled in an electric car.

Electric Car Plugged Into Charger

Source: @ezvolt.brasil/ Instagram

This was later scrapped, as it was decided that the state couldn’t make these changes; it was up to the federal government. (via Benzinga.)