Michigan is preparing to test a new way of taxing drivers: tracking how many miles they drive using GPS and smartphone data instead of relying on gas taxes at the pump. The pilot program, run through the state's transportation department, comes even though more than 30 percent of Michigan residents say they're worried about the privacy implications of this kind of tracking. The move raises fresh questions about road usage tracking privacy at a moment when location data is already one of the most sensitive categories of personal information collected about Americans.

What Michigan's Road-Usage Surveillance Program Actually Tracks

The basic idea behind road-usage charging isn't new. As electric and fuel-efficient vehicles use less gas, state gas tax revenue shrinks, and transportation officials have been looking for a replacement funding mechanism for years. Michigan's approach to testing this, however, relies on GPS-enabled devices and smartphone apps to measure exactly how many miles a vehicle travels, and potentially where and when those miles happen.

That distinction matters. A simple odometer reading at registration renewal tells the state how far you drove. GPS and telematics tracking can tell the state (and potentially any company managing the data) where you drove, how often, and at what times. Depending on how the pilot is structured, that data could reveal commuting patterns, trips to medical facilities, religious institutions, or protests, and other details that go well beyond what's needed to calculate a mileage fee.

The article notes that public unease is already measurable: roughly a third of Michigan residents surveyed expressed privacy concerns about this kind of program before it has even launched statewide. That skepticism reflects a broader pattern seen across the country whenever location-based tracking systems, from license plate readers to mileage-based tax pilots, are introduced.

Why VPNs Can't Hide Your GPS or Telematics Data

It's tempting to assume that privacy tools people already use, like a VPN on their phone or laptop, would offer some protection here. They won't. A VPN encrypts and reroutes your internet traffic, masking your IP address and making it harder for websites or your internet provider to see what you're browsing. It does nothing to stop a GPS chip in your car, a telematics device plugged into your vehicle's diagnostic port, or a mileage-tracking app from recording your physical location.

GPS tracking operates independently of your internet connection. The device calculates position using satellite signals, then transmits that data, often over a cellular connection, directly to whatever system is collecting it. A VPN sitting on your phone has no way to intercept or anonymize that stream, because it isn't internet browsing traffic in the traditional sense. In other words, tools designed for online privacy don't extend to physical-world location tracking built into a vehicle or a dedicated app.

This is an important distinction for consumers to understand. Location privacy and internet privacy are related concepts, but they require different defenses. A road-usage charging system that relies on GPS is a location-tracking tool first, and no amount of encrypted browsing changes what the device itself is reporting.

What Drivers Can Do to Limit Location Data Exposure

While drivers can't opt out of gravity or GPS satellites, most road-usage pilot programs, including similar efforts tested in other states, have offered alternatives to full GPS tracking. These typically include odometer-based reporting at set intervals, flat annual mileage estimates, or opt-in versus opt-out tracking tiers where drivers choose a less granular reporting method in exchange for giving up some convenience.

Drivers concerned about the specifics of Michigan's pilot should look closely at what data collection option, if any, is offered, whether data is retained after a fee is calculated, who has access to it, and how long records are stored. Asking whether third-party vendors are involved in processing the data is also worthwhile, since private companies sometimes operate the backend systems for these programs.

Which Other States May Follow Michigan's Lead

Michigan isn't acting in isolation. Several states have experimented with mileage-based road charging pilots over the past decade as gas tax revenue has declined nationwide. If Michigan's test produces usable data and public backlash stays manageable, transportation officials in other states are likely to study the results closely before proposing their own versions. Given that fuel tax revenue shortfalls are a shared problem across state budgets, road-usage charging is likely to keep showing up in policy discussions regardless of how any single pilot performs.

What This Means For You

If you live in Michigan, or in a state considering similar programs, it's worth paying attention to how any mileage-tracking pilot is structured before it becomes mandatory. The gap between an odometer check-in and a continuously tracked GPS feed is significant from a privacy standpoint, even if both technically accomplish the same billing goal.

It's also worth noting the broader pattern here. Michigan is simultaneously exploring tools that expand location tracking of residents while other states have pushed to ban VPNs as a means of enforcing age verification laws, restricting one of the few tools people have to protect their online privacy. Together, these moves illustrate a broader tension: privacy-protecting tools are facing new restrictions in some state legislatures even as tracking programs expand in others.

Road usage tracking privacy concerns aren't going away as more states look for ways to replace gas tax revenue. Understanding what's actually being collected, and recognizing that tools like VPNs don't address GPS or telematics tracking, is the first step toward making informed choices about programs like Michigan's pilot.

Takeaways for drivers:

  • Ask what tracking method (GPS, odometer check-in, flat estimate) your state's pilot program uses before opting in.
  • Understand that VPNs protect internet traffic, not GPS or vehicle telematics data.
  • Push for transparency on data retention and third-party vendor access if you're asked to participate in a mileage-based charging pilot.
  • Stay informed on state-level privacy legislation, since restrictions on tools like VPNs can move in parallel with expanded tracking programs.