Virginia Gov. McDonnell Proposes Eliminating Gasoline Tax

Virginia Gov. Bob McDonnell (R) announced a proposal Tuesday to remove the state’s gasoline tax, which would make Virginia the first state in the country to eliminate that tax.

The flat gas tax of 17.5 cents a gallon does not fluctuate with inflation, and cars are getting better mileage, reducing overall revenue, McDonnell said in a statement released late Tuesday.

The state’s diesel tax — also 17.5 cents per gallon — would remain in place and not be eliminated under the plan, which would also impose a $100 annual surcharge on alternative-fuel vehicles, including those that run on natural gas.

To make up for the lost revenue, McDonnell proposed boosting the state’s sales tax to 5.8% from the current 5% to help fund transportation projects.

The plan is expected to raise more than $3 billion for transportation over five years and would boost the amount of money going to transportation from sales taxes from the current 0.5 cent to 0.75 cent in that time.

Meanwhile, other states are also setting plans for transportation spending in 2013 and beyond as they announce new proposals and seek public input.

Missouri needs $1 billion more a year for necessary improvements to roads and bridges, according to a report by a special task force led by former Republican House Speaker Rod Jetton and by former Highways and Transportation Commission member Bill McKenna.

The task force did not lay out a funding plan but said possible options include bonds, toll roads, a sales tax increase or a fuel tax increase, the Associated Press reported.

Kentucky is seeking public input as it updates a 20-year long-range transportation plan. The Kentucky Transportation Cabinet released a public survey to find information about future transportation needs and where focus needs to be — maintenance, improving existing roadways, new roads or issues concerning other transportation.

Massachusetts has delayed releasing its transportation plan until next week to refocus the report on transportation as an economic driver, Gov. Deval Patrick (D) told reporters, according to news reports.

Patrick has previously supported boosting the state’s gasoline tax but said last week he is not sure that is a solution to the state’s transportation financing shortfall, AP reported.