Gov. Youngkin proposes to suspend Virginia's gas tax for 3 months

Posted at 3:27 PM, Mar 16, 2022
and last updated 2022-03-16 23:32:47-04

RICHMOND, Va. – Gov. Glenn Youngkin has proposed a gas tax holiday.

On Wednesday, he announced that he would send a bill to the General Assembly in the upcoming special session to suspend Virginia's gas tax for three months.

“I think it’s a great idea," said driver Elizabeth Rhoades.

Youngkin proposes using over $437 million in unanticipated transportation revenues to support the holiday.

Statistics show a 38.8% surge, year over year, and inflation on all items is at a 40-year high.

"Inflation, especially in energy and gasoline, is increasing because of failed policies by the current Presidential administration that constrain domestic supply. In addition, the conflict in Ukraine is further exacerbating the problem. These rising gas prices are hurting Virginians, and we need to do something about it," Gov. Youngkin said. "The Commonwealth Transportation fund has over $1 billion more revenue than anticipated this year and next, from the taxes paid by the people of Virginia. This bill gives money back to them in the form of a gas tax holiday."

The Motor Vehicle Fuels tax is 26.2 cents per gallon for gasoline and 27 cents for diesel.

"It’s not a ton, but any amount would make a difference," said driver Brendan Roess. "People fill up their gas tank twice a week, so that can definitely add up."

Youngkin proposes suspending it for three months - May, June and July - and phasing it back in slowly in August and September. His proposal would also cap the annual adjustment to the gas tax at no more than two percent per year. He says this is to protect Virginians from the hidden tax increase of inflation.

“We have to drive, regardless of what the gas prices are. We have no choice," said driver Michael Donaldson. "But it will make a big difference on where people go, how long they drive.”

Democrats in the Virginia Senate responded to Youngkin's proposal Wednesday night. Senate Majority Leader Dick Saslaw said the following:

While we can understand Governor Youngkin's desire to address high prices at the gas pump, fuel costs have actually been falling - 40 cents per gallon in the last four days. The Commonwealth's transportation budget relies on gas tax revenue; in my district, the region can't currently maintain our current infrastructure much less any new construction. Some roads even look like a war has been fought on them.

As final negotiations take place, we need to make sure we can provide relief for Virginians while still maintaining a robust and responsible budget. Senate Democrats look forward to working with Governor Youngkin, Senate Republicans, and the House of Delegates to achieve these and many other goals. Let's get to work.
Virginia Senate Majority Leader Dick Saslaw (D-Va.)

Revenue from the tax is deposited in the Commonwealth Transportation Fund along with a portion of the state's sales and use tax.

The Commonwealth Transportation Fund has $671.4 million unanticipated revenue in FY22 and $457.6 million FY23.

Related: Gas prices trend downward, with some stations in Hampton Roads under $4