Virginia Gov. Bob McDonnell will increase fees on hybrid vehicles, eliminate the state’s gasoline tax, and slightly increase the state’s Sales and Use Tax (SUT) as part of a major transportation funding overhaul.
Under McDonnell’s plan, which he unveiled on Tuesday, Virginia would eliminate its 17.5 cent gas tax, becoming the first state without one.
To replace the gas tax, McDonnell will increase the cost of registering a hybrid vehicle by $100 and a regular vehicle by $25. He also intends to increase the SUT tax by .8 cent.
According to McDonnell’s office, the plan would also “provide more than $3.1 billion in transportation funding for the Commonwealth over the next 5 years, tying transportation funding to economic growth.”
McDonnell said his plan would not burden drivers of “green” vehicles because they do not pay as much gas taxes–if they do at all–as other drivers. He said this allows those drivers to pay into the system because all of the cars use the same roads.
“Transportation is a core function of government. Children can’t get to school; parents waste too much time in traffic; and businesses can’t move their goods without an adequate and efficient transportation system,” McDonnell said. “We simply cannot continue to do what we have always done and expect this problem to go away.”
He added, “the current revenues numbers do not add up to a safe, efficient and sustainable transportation network.”
“The time is now for an innovative and sustainable plan to meet our transportation needs and grow Virginia’s economy,” McDonnell stated.