Virginia GOP proposes gas tax holiday as $375M relief plan

Virginia Republicans are calling for a temporary suspension of the state’s gas tax, a proposal they say would cost about $125 million per month and be covered using state reserves to provide short-term relief to Virginians.The push comes eight days after a House Republican spokesman, when asked about the idea by The Center Square, said it was yet to be discussed formally this session. He said lawmakers had not rallied around it.
Under the proposal, Republicans are asking Democrats and Gov. Abigail Spanberger to approve a 90-day suspension of the state’s motor fuels tax, which is about 32 cents per gallon for gasoline and slightly higher for diesel.
At that rate, the plan would total roughly $375 million over three months.
House Republican Leader Terry Kilgore said the proposal is aimed at easing financial pressure on Virginians as gas prices approach $4 per gallon in parts of the state.
“Each 30 days will cost about $125 million,” Kilgore said during a virtual press conference. “We have the money to do it.”
Republican lawmakers said Virginia has surplus revenue and reserve funds available to offset the cost, pointing to billions of dollars in state reserves. State budget documents show Virginia has accumulated billions of dollars across surplus balances and reserve funds in recent years.
“There are revenues there to offset this immediate need to help give the taxpayers of Virginia some relief,” said Del. Scott Wyatt, R-Hanover.
Republican lawmakers said the temporary suspension would not reduce funding for road construction or maintenance, despite the gas tax typically funding the state’s Transportation Trust Fund.
“It’s not going to be reducing any transportation dollars,” Wyatt said.
Revenue from the gas tax is directed to the Transportation Trust Fund, which supports road maintenance and construction projects statewide.
Republicans said the proposal could be implemented through the state budget or as standalone legislation during a special session.
They framed the measure as immediate relief tied to rising fuel costs, which they said have increased in recent weeks due to global factors.
In a statement, Spanberger said rising gas prices are tied to federal actions and global conflict.
“Let’s be 100% clear about why gas prices are skyrocketing: It’s because President Trump unilaterally launched a war with no thought to the direct impact on families in Virginia and across the country,” Spanberger said. “Right now, Virginians are feeling the brunt of the president’s actions at the pump and grocery store. As gas and diesel prices soar, I am working to create long-term solutions to address rising costs in energy, housing and health care.”
Gas prices in Virginia are ranging from about $3.20 to $3.50 per gallon at some stations, according to GasBuddy listings, with some areas nearing $4.
Sen. Glenn Sturdivant, R-Chesterfield, said rising gas and diesel prices are adding pressure to household budgets already impacted by inflation.
“For every gallon of gas, they are paying the state about 32 cents,” Sturdivant said.
Del. Michael Webert, R-Fauquier, said the temporary suspension could provide modest savings for drivers and businesses, estimating some Virginians could save about $36 per month, with larger savings for industries that rely heavily on fuel.
Republican lawmakers said any legislation could include requirements to ensure savings are passed on to consumers, along with protections against price gouging.
When asked about concerns that suspending the tax could reduce funding for transportation, lawmakers said reserve funds could be used to offset the loss.
The proposal would require support from Democrats, who control the Senate, as well as approval from the governor.
Republican lawmakers said they are seeking bipartisan support and called on Democrats and Spanberger to work with them to move the proposal forward.
Senate Democratic leaders did not immediately respond to requests for comment.

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