Virginia, Maryland Stations Worried About Gas Border War
NATIONAL HARBOR, Md. -- Maryland residents in this and many other border towns may soon be crossing into Virginia for gas.
On July 1, Virginia's current 17.5-cents-per-gallon gas tax will be replaced with a smaller tax on the wholesale price of gasoline, causing a decline of approximately 6 cents at the pump, reported WAMU.
Meanwhile, Maryland will enact the first of three gas tax increases on the same date. Its gas tax will rise to 27.5 cents per gallon on July 1. According to AAA, the average price for a regular gallon of gas currently stands at $3.39, 13 cents cheaper than in Maryland. Once July 1 arrives, this disparity will grow even larger.
The expected gasoline border war has many station operators concerned. "For the [Maryland gas stations] along the border, it's going to be a cat fight just to stay in business. It will put some of them out of business," Kirk McCauley, head of government relations for the WDMA Service Station and Automotive Repair Association, a group that represents gas stations in Washington, D.C., Maryland and Delaware, told the news outlet.
Approximately 77,000 Virginians drive into Maryland for work every day. If Maryland gas stations lose just a fraction of those customers -- who decide to fuel up in Virginia instead -- the lost business could be catastrophic.
"They can cross the river and go over the bridge and save -- once this thing is in full force -- 36 to 48 cents per gallon just in taxes," Fazal Sirhandi, a Sunoco-branded gas station and convenience store owner, told WAMU.
The gas price disparity could widen more in the coming years. Maryland Gov. Martin O'Malley signed the gas tax increase into law last year in an effort to raise $4.4 billion during the next six years. In addition to July's gas tax hike, the law states it will increase by another 8 cents in July 2015, with an additional 8-cent hike scheduled for 2016.