Virginia's Hybrid Tax on Path to Repeal

Virginia’s annual tax on hybrid electric vehicles is on the path to repeal.

The state Senate voted 35-3 this week on a bill that calls for rolling back the $64 annual tax. The proposed legislation also refunds fees paid in advance for the next year.

Senate Bill 127 now moves to the House of Delegates. Gov. Terry McAuliffe has said he will sign such legislation if it reaches his desk.

"I'm glad my colleagues have voted to repeal this illogical and punitive tax,” state Sen. Adam Ebbin, an Alexandria Democrat whose district includes parts of Arlington and Fairfax counties, said in a statement. “More than 7,300 Virginians have supported our repeal effort and in the Senate we were able to accomplish that. I am hopeful that my colleagues in the House of Delegates will see fit to do the same."

The bill that won approval was filed by state Sen. Stephen Newman, a Republican from the Forest community outside of Lynchburg. In November, Ebbin filed a similar proposal that was ultimately incorporated into Newman's bill.

The annual $64 fee was first attached to former Gov. Bob McDonnell’s 2013 transportation bill, where it was rejected by the state House and Senate. It ultimately came out of a conference committee still attached to the landmark transportation bill.

McDonnell, a Republican, reasoned hybrid vehicles use the roadways as much as gasoline-powered vehicles but are paying less of the gas tax because they’re fueling up fewer times.

Ebbin and Mount Vernon Democratic Del. Scott Surovell delivered a petition to McDonnell asking him to throw out the tax.

In July 2013, Ebbin and Surovell promised to present legislation to repeal the tax on the day it went into effect.

“People felt like this was a tax on virtue,” Surovell said at the time. “It was a tax on people for doing the right thing (by lowering emissions). We had people asking questions, ‘Are we going to start taxing vegetables?’ ”

A repeal would reduce the revenue generated by the transportation funding package by roughly $11 million, which cuts into the projected $1 billion it is designed to raise annually for transportation and transit infrastructure, according to the Richmond Times-Dispatch.

“I don’t care what kind of vehicle it is that they have, if you take up space on the roads of the commonwealth of Virginia, then you owe part of the fare,” state Sen. John Watkins, R-Powhatan, told the Richmond paper this week.

Watkins was one of the three "no" votes in the Senate.