Virginia residents could see a higher sales tax — and the state could become the first in the country to shed its gas tax — if a transportation plan unveiled by Virginia Gov. Bob McDonnell passes the state's General Assembly during its 2013 session.
The five-year, $3.1 billion transportation overhaul is the governor's attempt to address some of the state's major road and infrastructure needs in coming years; $14 billion in projects are already underway across Virginia.
McDonnell said the 17.5 cent tax on gasoline — which accounts for more than 30 percent of Virginia's transportation revenues — was "dated," blaming inflation and better mileage on the dollar for making it a stagnant funding source.
Raising sales tax from 5 to 5.8 percent, the other cornerstone of the governor's proposal, would generate more than $600 million in additional funds, he said, a pool that will grow with the economy.
McDonnell's changes would ultimately give transportation a larger share of sales tax revenues.
Read more here about the proposal, which the General Assembly will begin to review Wednesday as it begins its 2013 session.
The plan was McDonnell's attempt to appease both Republicans, many of whom have spoken against any kind of tax hike, and Democrats, who have said they don't want to give more general fund money to transportation over education and other state priorities.
Americans for Tax Reform has issued a statement against the governor's plan, saying the proposal "as it stands now fails in its goal to prioritize transportation spending while avoiding tax increases."
Lt. Gov. Bill Bolling (R), who holds the tie-breaking vote in Virginia's split senate, backed the plan Tuesday.
Tell us: Do you think the governor's plan is a sustainable option for road maintenance and new projects? Which state priorities do you think deserve more or less funding?
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