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User fee + tax reform = the right cocktail page 2
General Assembly 2013, transportation issues by

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Date published: 1/6/2013


Increases the additional registration fee on electric vehicles from $50 to $102, requiring hybrid vehicles registered in the commonwealth to pay this fee. Owners of hybrid vehicles registered in the commonwealth would be eligible for a refund of the new 5 percent tax on motor fuels sales.

The bill also:

Prohibits the placement of tolls on existing roads in the commonwealth without the approval of the General Assembly;

Lowers individual income tax rates and changes the individual income tax structure, effective Jan. 1, 2014. Income less than $5,000 would be taxed at a 0.75 percent rate, income over $5,000 and up to $17,000 would be taxed at a 4.5 percent rate, and income over $17,000 would continue to be taxed at a 5.75 percent rate;

Repeals income tax credits for vehicle emissions testing equipment, and clean-fuel vehicles, biodiesel fuel producers;

Eliminates the sales tax exemption currently to certain services, such as auto repairs, taxi, and limousines, armored cars, travel, and transportation.

This combination of user fees, tax reductions, and tax reform will net out with increased transportation funding that is desperately needed to improve Virginia's position with regard to economic development, and in particular with adequate transportation services to the ports of Virginia. It also addresses immediate needs in passenger rail, maintenance, and a local component to help address specific transportation-related projects. It is my hope that this will begin the return to economic vitality that Virginia needs.

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Sen. John C. Watkins, a Republican, represents District 10 (Powhatan County and parts of Chesterfield County and of the city of Richmond) in the General Assembly.