Northam’s budget proposal includes cigarette tax increase, eliminating vehicle safety inspections

Posted at 12:44 PM, Dec 17, 2019

RICHMOND, Va. – Governor Ralph Northam has presented his budget for Fiscal Years 2020–2022.

Gov. Northam (Photo by Win McNamee/Getty Images)

Northam’s office called this the “progressive in Virginia’s history,” and said it “makes significant investments in key priorities while maintaining strict fiscal responsibility.”

Northam wants to eliminate vehicle safety inspections, which will “save Virginians about $150 million each year.” Northam said data shows that there is no connection between highway safety and these inspections. Next, he aims cut the auto registration fee in half which could save Virginians more than $130 million per year, Northam said.

In 2018, miles driven in Virginia went up and Northam said less was collected from the gas tax. His goal would be to raise the gas tax four cents a year over three years, then to tie that revenue stream to inflation.

His budget sets up a state-based marketplace for the nearly 400,000 Virginians who buy health insurance on their own, rather than through an employer.

Northam said increasing the cigarette tax, currently the second-lowest in the nation, by 30 cents a pack will help pay for reinsurance which is a pool of money that helps insurers cover high-need people. The ACA included a reinsurance program, but that has expired, he said.

He has also made proposals to invest in K-12 educationaddress housing affordability, make tuition-free community college available to low- and middle-income students who pursue jobs in high-demand fields, protect Virginia’s environment, transform the Commonwealth’s early childhood education system and combat maternal and infant mortality.

Governor Northam’s proposal also brings Virginia’s total reserve funding to $1.9 billion, over eight percent of the total budget.

Click here to read Northam’s full remarks.