Republican state lawmakers propose three-month gas tax holiday in Virginia

Virginia’s GOP lawmaker caucus on Friday proposed the state create a three-month gas tax holiday, which they said would help residents weather the surge in fuel prices amid the ongoing Iran war. They urged Democrats to help them put the plan in motion when the legislature reconvenes next month to finalize the state budget. 

House Minority Leader Del. Terry Kilgore, R-Scott, said that the plan to pause sales tax the state normally levies on gas purchases would cost the state $125 million per month for the next three months. 

Legislators could propose a bill or budget amendment to accomplish this, Kilgore said, adding that the state should be in good financial shape to do so because it has garnered budget surpluses in recent years and could tap into reserves. 

The lawmakers would like the holiday to commence “immediately,” although they didn’t specify a date or time range. 

Sen. Glen Sturtevant, R-Chesterfield, added that if Democrats work with his party on the matter they could shave prices constituents pay at the pump and “make good” on their winning campaign promises of affordability that solidified their majorities last year. 

“If Democrats are willing to save the people money, this would be something that we could do right away. We’re here in the House to deliver 36 votes to make it happen,” Kilgore said. 

The proposal comes as a handful of other states are considering similar ideas and a gas tax holiday could offer consumers temporary relief. 

But the state taxes are a key source of revenue for transportation infrastructure like construction and maintenance — which can be particularly beneficial in areas of the state with lower local tax bases to draw from. 

Kilgore asserted the proposal for Virginia wouldn’t affect the state’s infrastructure just yet.

Recent gas price hikes stem from Operation Epic Fury, President Donald Trump’s name for the campaign of military attacks on Iran led by the United States and Israel that launched late last month. Over 1,900 people have been killed in Iran by U.S.-Israel strikes and 13 American military members have died, media reports confirm.

The conflict has created uncertainty surrounding the Strait of Hormuz, a critical global oil transit route. Iran has restricted access to some vessels in the region, sparking supply disruption among global markets and sending oil prices skyrocketing. 

Kilgore said he believed the conflict was necessary, citing Trump’s assertion that Iran was on the verge of developing nuclear weapons and reiterated the president’s claims that the war will be brief.

“I think it’s worth stopping Iran from getting nuclear capability, yes. Do I think it’s worth taking them off, taking them off the map as a terrorist, sponsor of terrorism? Yes, but we know this is going to be very temporary,” Kilgore said. 

In a statement released Friday afternoon, Gov. Abigail Spanberger didn’t explicitly support or denounce the Republicans’ gas tax holiday pitch, but laid the blame for gas hikes on Trump.

“Let’s be 100 percent 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,” she 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 healthcare.”

Former Gov. Glenn Youngkin introduced a similar proposal for a gas tax holiday in 2022, but it was blocked by Senate Democrats.

If the gas tax holiday pitch manifests into a formal proposal, lawmakers will consider it alongside existing budget priorities when they meet again in Richmond next month. 

Virginia’s House and Senate amended former Gov. Glenn Youngkin’s proposed two-year, $212 billion spending plan, including overhauls to be compliant with federal changes to Medicaid and the Supplemental Nutrition Assistance Program, and funding a state-level health insurance subsidy since Congress failed to renew Affordable Care Act subsidies. 

Legislators are also weighing whether or not to keep a tax break that benefits data center developers. Senate leaders said the state coup recoup ​​$1.6 billion annually by removing the tax exemption, while House leaders and Spanberger support keeping the exemption to preserve the data center industry’s presence in the state.  

Virginia’s General Assembly is set to convene on April 22 and 23 to review any legislation that Gov. Abigail Spanberger wishes to amend and to finalize the budget. 

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