April 19, 2022
Statement: Vote Advancing Proposal to Pause Retail Gas Tax Puts Families, Communities, and Economic Growth at Risk
Today, Ashley C. Kenneth, President and CEO of The Commonwealth Institute for Fiscal Analysis (TCI), released the following statement on the vote by the House of Delegates Finance Committee to advance legislation that would suspend the gas tax:
“Strengthening Virginia’s public infrastructure is important for all of us. Projects that improve our roads and public transportation are critical to growing our economy and improving safety.
“Today’s vote to pause the state retail gas tax for three months and cap retail gas tax rates in future years is both shortsighted and severely undermines the state’s ability to fund transportation projects that are crucial to every community across Virginia. Research shows that a significant portion of savings from this proposal would go to the oil industry and out-of-state residents.
“There are more targeted ways to help families who are struggling to keep up with the rising cost of gas and other everyday expenses while preserving resources for Virginia’s public infrastructure needs. Making the Earned Income Tax Credit (EITC) fully refundable would provide much-needed economic relief to families with low incomes who are most impacted by the rising cost of living. A refundable EITC would put an average of $500 in the pockets of families who need it most, which is equal to about 120 gallons of gas. Additionally, lawmakers could expand the proposal to provide one-time tax rebates this year by factoring in household size and making the rebates refundable so that low-income people with no income tax liability are eligible for the rebate.
“Gutting state transportation resources in order to provide financial benefits to the oil industry and out-of-state residents is not the answer to economic pressures that families from every corner of Virginia are facing. There are better policy options available to lawmakers that we will continue to advocate for this Special Session.”