41ºF

Say hello to a higher gas tax in Virginia

Gov. Ralph Northam signed the bill in April that's now in effect

photo

ROANOKE, Va. – July 1 means Virginia’s new laws go into effect.

One law most people won’t be happy about is the increase in Virginia’s gasoline tax.

Stay with us here because it’s a bit tricky how this increase works.

The key factor is that it’s a two-part increase.

Part One

Prior to July 1, 2020, the Virginia Department of Motor Vehicles determined the statewide average wholesale price of a gallon of gas so it could then determine the applicable cents per gallon in accordance with applicable tax rates.

Since January 2015, Virginians have been paying a tax of 16.2 cents per gallon on regular gas.

Now, House Bill 1414 jumps that tax to 21.2 cents per gallon.

The increase of this tax doesn’t stop this year.

On July 1, 2021, it will again increase by 5 cents to 26.2 cents per gallon and the following year, the tax will start being adjusted annually, based on inflation.

Part Two

The other part of this tax is a regional gas tax of 7.6 cents per gallon that will now be charged everywhere in Virginia.

For those along the Interstate 81 corridor, in Northern Virginia or in the Hampton Roads area, this regional tax is nothing new.

For those along I-81, that tax was 2.1 percent of the statewide average distributor price of a gallon of unleaded regular gasoline.

Since going into effect, it likely ranged from 2.2 cents to 4 cents per gallon. Now, it will assessed at 7.6 cents per gallon.

So this represents a 3.6 to 5.4-cent per gallon increase on the previous tax.

These are the 12 cities and 25 counties that were previously paying the Interstate 81 regional tax:

Cities: Bristol, Buena Vista, Covington, Galax, Harrisonburg, Lexington, Radford, Roanoke, Salem, Staunton, Waynesboro and Winchester

Counties: Alleghany, Augusta, Bath, Bland, Botetourt, Carroll, Clarke, Craig, Floyd, Franklin, Frederick, Giles, Grayson, Highland, Montgomery, Page, Pulaski, Rockbridge, Rockingham, Roanoke, Shenandoah, Smyth, Warren, Washington and Wythe

So...

No matter which way you slice it, Virginians will be paying more at the pump.

Going from 16.2 cents per gallon, to the now 28.8 cents per gallon is a 77.78% increase in gas tax.

But remember, not everyone across Virginia was only paying 16.2 cents per gallon as those in the three areas mentioned above were already paying some type of regional gas tax.


About the Author: