Politics & Finances
VA House Approves Tax Cuts Benefitting Small Businesses
In December, Virginia Governor Glenn Youngkin (R) proposed multiple tax breaks for businesses in The Old Dominion State.
Among these was a first-of-its-kind small business tax break that is designed to give entrepreneurs throughout the state immediate financial relief in the form of a 10% deduction for business income.
At the time, Delegate Joe McNamara (R-Roanoke), who is himself a small business owner, said of Youngkin’s plan, “I can’t find another state that appears to have this. So I think it is really exciting.”
Credit: Bruce Yuanyue Bi/Getty Images
McNamara went on to explain the tax relief proposal in empirical terms, saying, “So if you have a small business and you pay yourself a salary and still have some money left after paying all of your bills, let’s say you make $50,000, for that single person, pass-through business it would be about $280 worth of tax savings.”
Now, the Virginia House of Delegates – the state’s term for its House of Representatives – has approved Youngkin’s tax measures. The business tax proposal, HB 2138, would lower the state’s business tax rate from 6% to 5%, a move expected to save Virginia businesses about $300 million annually.
Furthermore, the aforementioned small business tax break that was included in the bill is estimated to save $275 million over the next two years. HB 2138 passed 52-47.
HB 2319, which changes personal income taxes in the state, also passed the House by a slim margin of 52-48.
After the bills passed the House vote, Governor Youngkin issued an official statement, saying, “Virginians are still overtaxed, they deserve to keep more of their hard-earned paychecks, and today’s significant move by the House of Delegates means Virginians are one step closer to additional relief.”
“Reinvigorating Virginia’s tax structure will help make the commonwealth competitive with other states so that we can compete to win,” he continued, “We proved last year (that) tax cuts don’t have to be a partisan issue.”
Both bills are now headed to the Virginia Senate, where they may face an uphill battle.
If you are a Virginia small business owner or resident invested in the progress of HB 2138, you can follow the latest information here.
Credit: Sky Noir Photography by Bill Dickinson/Getty Images
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