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Portland, OR -- As the federal government doles out tax credits for fuel-efficient vehicles, states wary of losing the fuel tax revenue from declining gas usage, are scrambling.

The federal government's tax credit for fuel-efficient vehicles creates a lower demand for fuel. As less fuel is consumed across the country, Fuel Tax Revenue, which is used to pay for roads, slowly drops. This is a perfect example of the state trying to control the market through incentives that lead to a slew of problems down the road.

Similar legislation was also proposed in Arkansas, earlier this year.

However, Oregon is spearheading this urge to charge people for their movement by actually implementing a program that will tax drivers by the mile.

While the program is still in testing, it will most likely become a model for states around the US who are scared of losing their revenue at the pump.

If you are poor and have to drive a long way to work, you can thank the government when you have to start eating ramen noodles every night so you can pay your driving tax.

According to the AP,

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Starting July 1, up to 5,000 volunteers in Oregon can sign up to drive with devices that collect data on how much they have driven and where. The volunteers will agree to pay 1.5 cents for each mile traveled on public roads within Oregon, instead of the tax now added when filling up at the pump.

The current program, called OreGo, will be the largest yet and will be open to all car types. Of these, no more than 1,500 participating vehicles can get less than 17 miles per gallon, and no more than 1,500 must get at least 17 miles per gallon and less than 22 miles per gallon.

Volunteers will still be paying the fuel tax if they stop for gas. But at the end of the month, depending on the type of car they drive, they will receive either a credit or a bill for the difference in gas taxes paid at the pump.

Those who bought electric vehicles are upset with the program.

"This program targets hybrid and electric vehicles, so it's discriminatory," said Patrick Connor, a Beaverton resident in an interview with the AP. He's been driving an electric car since 2007.

The mileage will be tracked with small digital devices provided by private vendors. Originally all of these devices were going to track the driver's locations through GPS. But after an outcry from the Oregon Chapter of the ACLU, the drivers can now opt for an odometer based device, sans GPS.

"This is the government collecting massive amounts of data, and we want to ensure the government doesn't keep and use that data for other purposes," ACLU's interim executive director Jann Carson said.

The state promises that they will destroy all records of location data and metered devices 30 days after they are read. But if we know anything about government and their collection of data, they lie about it. So don't hold your breath.

Many are concerned that this will discourage the purchase of fuel-efficient vehicles, and the are likely right. It will be interesting to see this unfold as one faction of the state continues to create an incentive for electric cars, while another faction creates an incentive against them.

What do you think about this tax? Would you rather pay at the pump or let the government install a tracking device inside your vehicle so they can tell where and how far you've driven? Let us know in the comments below.