Virginia‘s gasoline, retail and auto sales taxes rank among the lowest in the country, a Northern Virginia transportation group said in a report Wednesday that advocates greater funding for roads and transit.
The findings come as legislators are bitterly divided over how to replace lost revenue from last year’s transportation package that would have funded much-needed projects in Northern Virginia and Hampton Roads – much of which was struck down by the state Supreme Court as unconstitutional – and how to close a yawning deficit in highway maintenance.
The findings were compiled by the Northern Virginia Transportation Alliance from state and private sources.
Some or all of the taxes could be raised to pay for transportation projects, and Virginia still would rank significantly lower than other states, alliance President Bob Chase said.
“We’re not saying Virginia ought to aspire to be a high-tax state,” he said. “It simply responds to the argument that we’re paying far more than most people for state and local taxes. In fact, we’re paying far less.”
Virginia’s combined federal and state gas taxes tied for the 11th lowest in the nation at 38 cents per gallon, the same as New Hampshire, according to the American Petroleum Institute. Virginia’s 5-cent retail sales tax is tied for fifth lowest with Massachusetts and Maine, and the 3 percent tax on motor vehicle sales ranks as the third lowest – with New Mexico, North Carolina and South Dakota, according to state data.
Opponents of raising statewide taxes argue that Virginia’s low tax burden has fostered a friendly climate for growth, and that a gas tax increase would overburden motorists.
Democratic and Republican legislators and the governor have been sparring over whether a funding replacement for the unconstitutional regional taxing authorities will fall on local or statewide sources.
Del. David Albo, R-Springfield, said they are far from an agreement, and won’t be as long as Gov. Tim Kaine and the Senate’s Democratic leadership continue to insist on raising statewide taxes.
