I *do not* like any taxes. However, logically....this is the one that makes the most sense and is the easiest to implement. Odometer was at "x" on the '08 inspection, at 'y' on the '09 inspection, so you're taxed on the difference.
If someone wants to put a GPS on my car, they'll have a hard time leaving it there. I have a hammer.
If you ever leave the state you'll need to pay a different rate for that state's mileage tax.
Thus the necessity of the gubmint tracking your every move with GPS so they only charge you for miles driven in your state.
And, yes, congratulations, your gps data indicates you've been speeding and have some fines to pay!
And if you get pulled over and don't have your GPS device attached, well, good luck going to court to get your license - and car! - back.
Also, the way they're testing the system, you pay less taxes if you have a fuel efficient car and drive fewer miles. Well, that runs into the exact same revenue "problem" they're having with gas taxes! It's just easier to justify a mileage tax you pay once a year (they'll probably be nice enough to withhold money from your paycheck!) than to see the federal and state gas taxes posted on the pump every time you spend $40 to fill up.
People will roll back the odometer.