Despite a massive budget surplus, Virginia’s gas tax remains one of the highest in the country thanks to a 2020 law passed by Democrat Governor Ralph Northram.

According the Tax Foundation, Virginia ranks ninth nationwide at 41.6 cents per gallon. California, Illinois, and Washington are the highest three states. Virginia is the highest of the Southern States.

The total gas tax includes a state motor fuels tax rate and a sales tax rate for gasoline. Since 2019, motor fuels tax has doubled from 16.2 cents to over 32 cents per gallon. A tax increase went into effect July 1.

In the last fiscal year in the Youngkin-Sears administration, Virginia state revenue skyrocketed, beating both initial and revised estimates and totaling close to $2.7 billion. Virginia managed to bring in $31.2 billion for the general fund, an increase of 6.1% from last fiscal year and 9.3% above the original forecast.

Virginia’s four-year surplus has reached $10 billion with another $9 billion returned to taxpayers. (RELATED: Hitachi Energy to Invest $457M in Virginia Plant, Creating 825 Jobs)

Legislative Democrats blocked previous proposals by Governor Glenn Youngkin for a gas tax holiday claiming that the estimated $400 million cost would put an undue burden on the state’s budget. The estimated cost of the gas holiday would only be about 15% of the budget surplus.

The annual increase in gas taxes is the result of legislation passed in 2020 and signed into law by Democrat Governor Ralph Northram which makes gas tax increase automatic with each new fiscal year. Despite having the three statewide offices, Republican minorities in the legislature do not have the votes to repeal the automatic tax increase.  

Virginia designates the gas tax as an “earmarked tax” specifically for funding roads. Republicans argued that opening up the general fund to cover transportation costs would have prevented the need for an automatic gas tax increase in 2020.

Federal taxes add another 18 cents per gallon to the price of fuel.