What is the Gas Guzzlers Tax?
“Gas Guzzler” is a wonderfully alliterative term that refers to cars that don’t meet the EPA (United States Environmental Protection Agency) gas mileage threshold. In 1978, the Gas Guzzlers Tax was created by Congress under the Energy Tax Act to motivate car manufacturers to produce more energy-efficient cars and to incentivize car buyers into purchasing more fuel-efficient cars. The tax still exists, and still applies to cars only, just as it did in 1978.
The GGT applies only to new cars that don’t achieve 22.5 mpg on a test using a formula involving 55% city driving and 45% highway driving. There is more to the formula, of course; the amount of the tax is calculated using fuel economy values and the total number of gas guzzlers sold in a particular year. It is worth noting that the manufacturers are the ones who are responsible for paying the tax at the end of each year – they pass the cost on to the consumers, and you will see it on the Monroney Label (window sticker) if you are looking for new gas guzzling cars. Expect to pay anywhere from $1,000 for cars with a fuel economy of at least 21.5, but less than 22.5 mpg – up to $7,700 for cars with a fuel economy of less than 12.5 mpg.
What About SUVs and Other Types of Light Trucks?
When the GGT was first implemented, trucks were exempt because they were considered to be work vehicles. Today, light trucks account for 79.2% of all new vehicles sold, according to the National Automobile Dealers Association. You may be thinking, “Well, I see a lot of new pickup trucks on the road, but surely not that many!” – and you’re not wrong. The “light truck” category includes SUVs, jeeps, vans, and minivans. There simply weren’t many of any of these types of vehicles on the road in 1978. The Ford Bronco was popular, but SUVs didn’t come into their own until the 1980s. As for minivans, they weren’t even introduced until 1983, when Chrysler released the 1984 Dodge Caravan and Plymouth Voyager. It’s not surprising that none of these “light trucks” were considered to be threats to fossil fuels 45 years ago. There simply weren’t enough of them around to be concerned about– and the types that were around were considered to be commercial vehicles, not passenger vehicles.
Now, of course, things have changed, and there is a groundswell of support for allowing SUVs, minivans, trucks, and crossovers to fall under the aegis of the GGT. According to an analysis discussed in a recent article in The Guardian, gas guzzling SUVs are “the second largest contributor to the increase in global CO2 emissions between 2010 and 2018.” (This puts them behind the power industry, since in 2023, coal is the largest source of CO2 emissions worldwide.)
Are Classic Cars Impacted by the Gas Guzzlers Tax?
No, by their very definition, classic cars are not new cars, so they aren’t affected by this gas tax, despite their notoriously low mpg. In 2023, the average is 36 mpg; furthermore, new emission rules rolled out last year will require cars and trucks to have an average fuel economy of 49 mpg by 2026. Contrast that with the 1972 Pontiac Firebird Trans Am’s average fuel economy of 11.72 mpg or the 1969 Chevrolet Camaro SS estimated mpg rating of 6.7 mpg. (That particular model is known as one of the biggest gas guzzlers ever). Ultimately, those who are in the market for a new SUV, jeep, truck, or van may want to stay up to date on the Gas Guzzlers Tax in case the rules broaden to include “light trucks,” but classic car owners and prospective owners have nothing to worry about.
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