Warner Should Show "Active Leadership," Cut Commonwealth's Fuel Taxes, Citizen Group Says

(Alexandria, VA) -- Governor Mark Warner can help to "cushion the blow" of Katrina-related fuel supply disruptions and ongoing gas price spikes by lowering taxes on motorists: that's the message in an open letter sent to Warner today from the 400,000-member National Taxpayers Union (NTU). The non-partisan citizen group has over 9,500 members in Virginia.

"NTU encourages you to permanently lower state gas tax rates or provide temporary relief through a 'gas tax holiday,'" NTU Government Affairs Manager Kristina Rasmussen wrote to Warner. "It is our belief that such a move would be the best solution available for assisting consumers in your state in this time of crisis."

Rasmussen noted that last week Georgia's Sonny Perdue became the latest Governor to temporarily suspend by Executive Order the state's per-gallon and sales taxes on gasoline (following those in Illinois and Indiana who did so in 2000). Although laws in some states can limit the authority of chief executives over tax policies, all Governors can at least call special sessions of their State Legislatures to enact fuel tax relief.

However, Rasmussen also cited other reasons why Warner should act constructively on behalf of Virginia's consumers, with tax and regulatory relief rather than price or demand control schemes. The Commonwealth's government, which will likely collect $13.9 billion from taxpayers this year and enjoy a budget surplus of more than $500 million, could absorb any revenue "losses" that might occur (gas tax proceeds may already be dropping due to reduced consumption). Furthermore, even though Virginia's gas tax ranks 37th from the top nationally, when combined with the federal tax motorists here face a 36 cent-per-gallon rate (local option sales taxes only worsen the burden). This adds $5.39 to the price of a 15-gallon fill-up.

NTU is undertaking or planning many activities in support of fuel tax relief for Virginians, including coalition efforts with local taxpayer groups throughout the Commonwealth, talk radio appearances, e-mail alerts to concerned citizens, and possibly, paid advertising.

"Although using budget reserves to fund new spending programs may be tempting, lowering state gas taxes immediately is a better way to assist Virginians as all taxpayers and aspects of your state's economy are affected by rising gas prices," Rasmussen concluded in her letter to the Governor. "Your active leadership would ensure that beleaguered Virginia motorists can better cope with this trying time."

NTU is a non-profit organization working for lower taxes, smaller government, and economic freedom at all levels. Note: Rasmussen's letter to Warner, along with numerous studies and commentaries on government transportation policy, may be accessed online at www.ntu.org.