Muscle car owners are under attack from the government. The federal government signed the Corporate Average Fuel Economy rules last December that mandated that all cars must get 35 miles per gallon by the year 2020, which effectively makes the standard muscle car V8 engines extinct. As if attack from the federal government wasn't enough, state governments are getting in on the act with “punishment taxes” for muscle car owners.

The intent of the law is to encourage car shoppers to consider smaller, more fuel efficient vehicles with better emission standards. States are now discussing laws that will levy a steep surcharge or tax on any car with higher emissions levels or a large engine.

The punitive taxes can be as high as $2500 in addition to federal taxes that are also levied against cars that don't meet gas mileage requirements. Many states are trying to impose the new punishment tax against gas guzzling cars because they don't feel the new federal laws went far enough to discourage the purchase of cars with low gas mileage and higher pollution levels.

Critics of the new law say that the taxes would not help the environment and would hurt the already struggling automotive industry by impacting the sale of high profit margin vehicles like the Ford Mustang and the soon to be released Dodge Challenger an Chevy Camaro. Critics also complain that the news laws violate the constitution and interfere with a consumers right to choose the car of his or her choice.

New York legislators have proposed a progressive purchase surcharge for cars that have high carbon emissions. If passed, the surcharge could add as much as $2500 to the cost of a new car. Money collected from the punitive surcharge would be used to offer discounts for hybrid and electric cars. The legislators of New York want to take money from people who buy high carbon emission vehicles and give it to people who will buy more energy efficient cars.

Not to be outdone, Hawaii is considering legislation that would charge a fee that would increase with engine size. The fees would not be a one time surcharge at the time of purchase, but rather an annual fee that would be payable when a car's registration was renewed. The law would target owners of cars with an engine over .2 liters, effectively taxing every car in Hawaii as there are no engines currently produced that are under .2 liters.

Washington State is also getting in on the punishment tax game by attempting to tax vehicle emissions. A Washington State Senator has called for two new automotive fees. The first would be based in engine size. Any engine greater than 8.0 liters would be charged $600 every year when the car registration was renewed. The second tax is based on emissions. Cars that emit more than 362 g per mile of CO2 would also pay a $600 fee. Smaller cars with lower emissions would still pay the fee, just at a lower rate.