Consumption Tax

State legislation that became effective on January 1, 2001 replaced 3 existing taxes with a new state-wide "Consumption Tax." The 3 taxes that were replaced are:
  1. The State Gross Receipts Tax
  2. A regulatory tax imposed by the State Corporation Commission
  3. The Local Utility License Tax
As a result of the state legislation, consumers now see a line on their electricity and natural gas bills that says "Consumption Tax." Although the line on the bill is new, consumers have been paying the three taxes indirectly for years. These taxes were "imbedded" in the rates of the utility companies and are now separated from the rates and considered as a single tax.

The rates for the local (Roanoke City) portion of the Consumption Tax for both the electric and natural gas utilities are specified by Sections 58.1-2900 and 58.1-2904, respectively, of the Code of Virginia.