Virginia Gas Tax Revenue Falls as Car Fuel Efficiency Soars

For the first time ever, Virginians are driving more and spending less at the pump. That’s good news for consumers, but bad news for the state’s bottom line.

The Commonwealth Transportation Board revealed that from 2016 to 2018, Virginia drivers traveled 3.2% miles more, but gas tax revenue fell 0.4%. That shortfall cost the state more than $30 million in tax revenue. Experts say that the trend has been a long time coming.

“We actually are making a little less money on the gas tax than we were in 1977,” Bill Shobe, the Director of Economic Policy Studies at UVA’s Weldon Cooper Center said. “Even though the vehicle miles traveled have gone up about 70% since then.”

Experts say that the tax revenue is largely due to the increasing fuel efficiency of modern cars.