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RICHMOND – The Virginia Department of Motor Vehicles implemented a number of changes stemming from the transportation funding legislation that became effective July 1.
Starting July 1, the sales and use tax (SUT) increased from 3 to 4 percent. Additionally, per the new legislation, the tax will now be assessed based on the sale price minus any manufacturer rebates. The minimum tax increased from $35 to $75.
Also effective July 1, owners of hybrid and electric vehicles will now pay a $64 annual fee in addition to registration fees. This fee does not apply to mopeds. Previous law required a $50 annual fee for electric vehicles only.
A key component of the transportation funding package also impacts the tax imposed on gasoline, diesel and other types of fuel. Virginia formerly levied a tax of 17.5 cents per gallon on all fuels used in highway vehicles.
Effective July 1, the rate for gasoline is now 11.1 cents, based on 3.5 percent of the statewide average wholesale price for a gallon of gasoline, while the rate for diesel will be 20.2 cents, based on 6 percent of the statewide average wholesale price for a gallon of diesel.
DMV will evaluate and publish these tax rates twice a year.
To compensate for the higher tax rate levied on diesel versus gasoline, the new law allows drivers of diesel-powered passenger vehicles and trucks up to 10,000 pounds to obtain a refund equal to the difference between the diesel and gasoline tax rates.
To qualify for a refund, the purchaser of the fuel must retain original receipts and file a fuels tax refund application with the Department of Motor Vehicles. Effective July 1, customers who qualify for a refund and who have purchased at least five gallons of diesel fuel may visit the DMV website at dmvNOW.com to file an application electronically.
The applicant can apply for refunds from multiple purchases at one time; however, applications must be filed within 12 months of the date the fuel was purchased. Customers will need the following information to complete the application: the date the fuel was purchased, the number of gallons purchased and the odometer reading of the qualifying vehicle at the time the application is filed.
The refund applicant must have receipts to support the refund claim and may be asked for additional information before or after the refund is issued.