Hawaii to Charge EVs a Road Usage Tax Starting July 1

Revenue generated by Hawaii’s gas taxes is declining because more Hawaii residents are driving electric and hybrid vehicles. The RUC is designed to provide “fair, long-term, sustainable funding for Hawaii’s roads,” according to the Department of Transportation.

by Gail Cole, CPA Practice Advisor, March 26, 2025

On July 1, 2025, Hawaii will implement a state electric vehicle (EV) mileage tax. Revenue generated from the road usage charge, or RUC, will help fund state transportation projects and road infrastructure.

For now, the RUC is optional: EV owners may continue to pay a flat $50 annual surcharge instead. In Maui Country, EV owners will continue to pay a $100 annual county registration surcharge as well.

Hawaii’s road usage charge will become mandatory starting July 1, 2028, at which point the $50 flat fee will be discontinued. Here’s what you need to know.

What is the Hawaii road usage charge?

The new road usage charge in Hawaii is $8 per 1,000 miles and is capped at $50. Odometers will be read and recorded each year during annual vehicle inspections. Because it’s based on miles traveled, the RUC is similar to an EV road tax. The more miles you drive, the more you pay (up to a point, given the $50 cap).

Is Hawaii’s RUC mandatory?

No, the Hawaii RUC isn’t mandatory at this time: EV owners can choose to pay a flat $50 fee instead. They’ll make their choice when they renew their registration. However, the flat rate will no longer be available after June 30, 2028.

For now, EV owners that drive more than 6,300 miles in a year may prefer the $50 flat fee. And that may turn out to be most EV drivers. According to the Hawaii Department of Transportation, average distances driven annually in the Aloha State are as follows:

8,700 in Honolulu City and County
8,900 in Maui County
9,000 in Kauai County
9,700 in Hawaii County

EV owners that drive far fewer miles would save money by paying the RUC of $8 per 1,000 miles. The Hawaii Department of Transportation has an EV road usage charge estimator to help Hawaiians decide which way to go.

Who pays the road usage charge?

The registered owner of the EV will pay the RUC.

How does Hawaii’s RUC program work?

Starting July 1, 2025, EV drivers will be able to choose between a flat $50 fee and the RUC of $8 per 1,000 miles when they register their electric vehicle. To accurately assess the per-mile tax for electric cars, state officials will need at least two odometer readings. The amount will default to the $50 flat fee if there’s inaccurate, incorrect, or missing information.

For EVs purchased after July 1, 2025, the $50 flat annual RUC will apply the first time registration is renewed. After that, owners will be able to choose between the per-mile RUC and the flat fee until July 1, 2028.

Effective July 1, 2028, all EV drivers in Hawaii will be required to pay the per-mile RUC. Eventually, the RUC will apply to all other vehicles as well. The Hawaii Department of Transportation plans to fully transition to an RUC by 2033.

Do any Hawaii counties have a road usage fee for EVs?

The RUC is a state fee. All counties currently have a county gas tax, and Maui County charges an annual county registration surcharge for EVs.

But there could soon be new EV tax laws in Hawaii. Each county is responsible for paying a portion of the funds needed to maintain bridges and roads, and must determine the best way to generate that revenue. House Bill 1161 and Senate Bill 1480, which are making their way through the Hawaii Legislature, would enable counties to establish a mileage-based road usage charge for EVs and plug-in hybrid vehicles.

Why is Hawaii implementing a road usage charge for EVs?

Revenue generated by Hawaii’s gas taxes is declining because more Hawaiians are driving electric and hybrid vehicles. The RUC is designed to provide “fair, long-term, sustainable funding for Hawaii’s roads,” according to the Department of Transportation.

What other states charge a fee for road usage?

Oregon, Utah, and Virginia are among the states with a road usage charge for EVs. All such programs are currently voluntary.

Under Oregon’s OReGO program, participants pay two cents for each mile driven and a reduced annual DMV registration fee. OReGO is open to electric, hybrid, diesel, and gas-powered vehicles with a mileage rate of 20 miles per gallon or better.

With the optional Utah Road Usage Charge Program, participants pay 1.11 cents per mile and the fee is capped at $143.25 through June 30, 2026. Participants can opt to submit a picture of their odometer every three months or implement telematics, whereby the vehicle automatically records and reports mileage data. 

Approximately 7,200 vehicles currently participate in Utah’s voluntary RUC program. For now, EV drivers in Utah may choose to pay a $143.25 flat fee for alternative fuel vehicles instead. 

Virginia adopted a voluntary Mileage Choice program in 2020. To participate, drivers install a mileage reporting device in their vehicles and then pay a per-mile Highway Use Fee (HUF) rather than a flat annual highway use fee. Virginians who drive less than 11,600 miles annually can save money by participating in the Mileage Choice program.

Road usage charges and per-mile taxes may be the wave of the future, at least for EVs. They’re generally considered to be fairer than the electric car registration fees that approximately 40 states use to recoup gas tax revenue. What this will mean for gas tax policies remains to be seen.

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