Virginians Face Higher Taxes Online or at the Pump

By: Val Thompson Email
By: Val Thompson Email

April 29, 2013

The debate in Congress over adding a sales tax to Internet purchases could end up costing Virginians more at the gas pump.

Tucked into the massive transportation bill that the General Assembly passed earlier this year is a provision that would raise the gas tax if Congress fails to pass an Internet sales tax before the end of 2014. The provision was necessary because hundreds of millions of dollars of Virginia's transportation funding is reliant on that new sales tax revenue.

"Internet sales tax has been voted down two or three times before in Washington," said Democratic State Senator Creigh Deeds, from Bath County. "It's not a sure thing now. I think the better way to get money for transportation is from the people who use the transportation system."

Deeds would not comment on whether he would rather impose an Internet sales tax, or see Virginia's gas tax go up. He said he's just happy that the transportation bill will provide money for Virginia roads in either scenario.

If Congress does not approve an Internet sales tax by the end of 2014, wholesale gas taxes in Virginia would increase from 3.5 percent to 5.1 percent on January 1, 2015. That represents a 64 cent increase on a $40 tank of gas.

"Personally, I don't think it's a good idea," said Charlottesville resident John Divers. "I'm retired. I'm on a fixed income. Right now it's costing me almost $20 more a month than it did couple years ago."

"I remember back in the day you could get gas for a dollar something a gallon," said Eric Fitzgerald, who works for a plumbing company. "Five dollars you could ride all day long. Now what's five dollars going to get you? Up the street."

But other drivers say they would rather pay a little more at the pump, than be taxed for online purchases.

"I think that we pay one of the lowest gas rates in the world," said Charlottesville resident Pam Scott. "So I'm OK with it."

Republican Rep. Robert Hurt, from Virginia's 5th District, is not taking a position on the issue of an Internet sales tax. He released a statement, saying: "We are monitoring this issue very closely and we look forward to taking a look at what comes out of the Senate."

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