The notion of charging different fees or taxes by engine displacement is idiotic. It has nothing particularly to do with road wear, emissions, or safety hazards.
If you want a measure that can not be easily manipulated and can serve as an albeit imperfect proxy for wear, emissions, weight and last but not least ability to pay then displacement is an option for taxation.
Larger displacement engines are almost invariably in larger, heavier, vehicles. Axle weight determines road wear. I agree that using the axle weight would be better but displacement taxes were also a luxury tax.
> Larger displacement engines are almost invariably in larger, heavier, vehicles.
This isn't even a good approximation because turbochargers (which nearly all heavy, diesel vehicles have) significantly increase power at the same displacement. The 5 liter Mustang weighs less than 4000 pounds. Here's a >10,000 pound bus with a 3.2L diesel engine: