Virginia pols push aggressive tax hikes and tax cuts
McAuliffe has proposed $105.7 million in personal and corporate tax cuts in his new budget. He also plans to expand Medicaid, a goal he has failed to achieve on two prior efforts during his first two years in Richmond.
Republicans in the General Assembly criticized McAuliffe's plan to expand Medicaid. But they said nothing directly about the Democratic governor's idea of cutting Virginia's corporate tax rate to 5.75 percent from 6 percent. Nor did they mention McAuliffe's idea to expand personal income tax deductions.
In his remarks before the House and Senate budget committees on Thursday, McAuliffe said he would increase the "personal/dependent exemption on the individual income tax return ... from $930 to $1,000," while also increasing the personal tax deduction for "the aged and blind" from $800 to $900.
Other tax bills to watch in the 2016 session include a proposal from Sen. Bill Carrico (R-Galax) to impose annual registration fees on motor vehicles, trailers, and semitrailers in the commonwealth. His Senate Bill 35 would tack an additional $1.25 to each vehicle registered in the state beginning in 2016, and increase the fee by $1.25 each year through 2025, when it would settle at $12.50 per vehicle.
Carrico's aim is to have these new funds given to the State Police to support officer training and pay. A similar measure Carrico sponsored in the 2015 session passed the Senate, but died in the House of Delegates.
A fiscal impact statement from the Department of Planning and Budget estimated the earlier legislation, which contained the same fee structure as Carrico's new bill, would have generated more than $9 million in new revenue in its first year, and $61.5 million by 2021.
Carrico, a former state trooper, told AMI Newswire the bills are "very similar, but I really don't know how the House will receive this year's bill."
He is equally unsure of how his Senate colleagues will react to the idea of hiking registration fees. "With seven new senators this year, its passage isn't guaranteed in the Senate," Carrico said. "Obviously, I am hopeful, but after 14 years in the General Assembly, I realize that nothing is a sure thing when it comes to legislation."
Another tax measure from Del. Jeffrey L. Campbell (R-Saltville), would grant all Virginia counties the power to tax cigarette sales. Under current state law, only Arlington and Fairfax counties have such authority. Campbell, a former Saltville mayor, did not respond for comment on his proposal.
Not all of the tax bills to be considered relate to Virginia's tax code.
Del. Mark Cole (R-Fredericksburg) has introduced a House joint resolution calling on the U.S. Congress to "repeal all personal income and other taxes" at the federal level and replace them with "a national retail sales tax."
Cole told AMI Newswire he filed the joint resolution "at the request of a constituent."