Virginia Transportation Funding Deal

The run-up in gaso price is due to the annual shift to summer fuel blend due to EPA regs. Summer fuel is more expensive because EPA requires refineries to take butanes out of gasoline to minimize evaporative hydrocarbon losses. Also refineries come down for maintenance right now, to ensure they have no maintenance required for the rest of the summer gasoline season. In reality crude oil supply is good.

 

Hey are you related to the author? I would sort of agree with the article, but note that the dems with repub support already started building the billion dollar transportation projects, so money had to come from somehwere. McDonnell gave the dems what they needed: money$$, and then the dems were off the hook for the spending....the dems just needed the Gov to identify the taxable victims, and he obliged them <and the vicitim was me>.

 

I spoke to three Virginia Toyota dealerships today, generally these guys (and gals) are busy selling cars, and not up to date on the new VA taxes. One thing everyone can do: is call or email your dealer and/or salesman, and just ask if they heard about it, and say you are concerned about it.

Here is the my email to my Prius salesman:

OK Fred - Thank you for getting back to me!
However, I am a little concered about the new $100 per year Hybrid tax in VA. Between this new hybrid tax, sales tax, and property tax, think we might be talking up to +$2000 VA tax "bite" on something like a Camry Hybrid vs. Camry regular, if held 10-yrs.

If you get the chance, feel free to mention my concerns about the new VA hybrid tax to ABC Toyota management. I talked to the XYZ Toyota general manager today, and he feels this new tax was not discussed with VADA (VA Auto Dealers Assoc) prior to adoption, so he feels that VADA may be able to work out the issue.

Best regards

 

I am glad to have support of diesels and Green Car Reports. But actually the gaso tax reduction vs. diesel is potentially temporary. VA gaso tax goes back to current levels unless US Congress lets states tax internet sales, which they say is only so so (50/50) chance.

The good news *might* be the Gov has not signed the bill yet. I did not realize that he had a chance to ammend the bill.

 

OK another crazy day of concerned citizen activism in NoVa!

I turned on the radio at 10:45AM towards the end of the Ask the Governor show on WTOP news radio:
McDonnell: Sequester will happen, impact on Va. immediate - WTOP.com

Here is management summary- When the commentator asked about the constitutionality of the various transportation bill provisions, Governor McDonnell said that could be a problem and he alluded the need to take a lot of time to review the bill(s) before he signs it. He may need to make some chnages - I had no idea he was going to take time to review and edit the provisions, so all is not lost yet!

The commentator mentioned the Petition (Post #46) on the hybrid tax. I plan to elevate the visibility of the petition as soon as I verify it is the way to go. I already signed it.

My favorite quote was when the commentator asked: "Isn't this hybrid tax just another way to shift the tax burden to Northern Virginia residents?" The Gov response was weak, he said electric cars pay no road tax so they need to pay the new tax. Of course, Prii are not electric vehilces...As he is talking, I am tweeting into the show: "look green cars are more expensive and we are already paying thru the nose on annual property taxes in VA..."

For those of you casually following this tragic comedy, you may not realize there are actually two(2) bills! This first bill gave approval for a large sales tax increase - on Northern Virginians only!!! ...and they threw in Norfolk region as a second victim. So, you may not realize the upshot is that NoVa residents get a +1% sales tax increase as well as a Hybrid tax.

This is why the constitutionality is in question. You may ask, why are the dems going along with this?...well they need the money for mega-projects they have already started building, such as DC Metro new Silver Line to Tysons Corner and Dulles IAD airport.

 

...some of you Prius Chatters may find this humorous , but due to the VA crisis, I joined PlugInAmerica.ORG ! Gladly made my tax deductible $25 contribution. Of course, as some of you know, the co-founder Chelsea Sexton is my new hero. So hey, why not? And of course I sent them a personal note on the VA crisis. Next thing you know, I get the following email from PlugInAmerica.com:

I am thinking, tell me something I don't already know! Also please sign the petition at NoHybridTax.com

 

LeeB: how is the Petition doing? Do they want out-of-state signatures? Should we make a bigger post to get more attention to this?

I know Chesapeake Action Group sent this out to their mailing list today, but I did not see a copy of their email yet.

For those so inclined: sign off at NoHybridTax.com

 

Here is my first estimate of the Virginia "Hybrid Penalty" under the new law. The "Hybrid Penalty" is the extra tax paid to Virginia due to purchase of Hybrid vs. gaso engine version of the same vehicle.

Firstly, sales tax on cars is going from 3 to 4% in the new law
>>so that's $160 extra sales tax on a Hybrid
(NOTE: Basis for all calcs is +$4000 for a Hybrid vs Gaso engine).

After that annual VA property (car) tax varies by locality, but my approximation:
2% on first $20,000 (NADA Value) + 5% on the amount over $20,000 (NADA Value)
NADA Value is the Clean Trade Value.

The VA "Hybrid Penalty" thus has two cases:

Case (1) Car Value <$20,000 - e.g.; small Prius "c"
Hybrid Tax Penalty= $160 sales tax + $80/yr = $960 for 10-yrs
say 30% less w/ depreciation = $670
Add on new $100/yr fee = $1000 + $670 = $1670 10-yr VA Hybrid Penalty (<$20,000 car)

Case(2) Car Value over >$20,000 - e.g; Highlander SUV Hybrid
Hybrid Penalty= $160+ $200/yr (first 4 yrs) + $80/yr (next 6 yrs)= $1440 for 10 yrs
say 20% less w/ depreciation = $1150
Add on new $100/yr fee = $1000 + $1150 = $2150 10-yr VA Hybrid Penalty (~$35,000 Car)

In plain English, a "cheaper" hybrid car would pay $160 more sales tax, plus $80/yr more property tax, plus the new $100/yr Hybrid fee. A more expensive hybrid car would pay $160 more sales tax, plus $200/yr more property tax (eventually it drops to $80/yr), plus the new $100/yr Hybrid fee.

Again, above we are not talking total taxes. This is just the extra amount of tax that VA wants as a penalty for a person who buys a Hybrid vs. gasoline engine equivalent of the same vehicle! Let's just say that's $2000 on average, so the Hybrid buyer is now paying $4000 + $2000 = $6000 extra for the vehicle.

We just have to realize this could shift car sales away from gasoline Hybrids.

 

Virginia "NoHybridTax" Petition
moved (see PriusChat HOME PAGE)

 

I was asked to write a letter to the editor...here is what I said:

Virginia's Hidden Hybrid Car Penalties
The proposed Virginia Transportation deal places a large "hidden" tax penalty on hybrids. If you live in Virginia, you know that the annual car property taxes can be excessive. Now consider that a typical hybrid car costs about $4000 more to purchase versus the equivalent model with a conventional gasoline engine. The cumulative tax "bite" for a new Hybrid would be (approximately): extra sales tax on a Hybrid ($160); extra property tax on a hybrid ($200 per year); and the proposed new hybrid fee ($100 per year). The extra property tax goes down to about $80 per year after the car blue book value drops below $20,000. Over the years the total hybrid car penalty in Virginia would approach or exceed $2000 for many models. The bill's proponents claim the extra taxes offset the avoided pump taxes of hybrids, but this is typically only about $35 per year savings in Virginia. It is my belief that hybrid car sales will suffer due to the punitive tax treatment. Note that, unless they plug-in, typical hybrids get no Federal nor VA state subsidies, so the dent in the pocketbook is real. There is a ray of hope because Virginia localities are authorized to give tax relief to green cars, but most do not.