Tag: Conformity
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State Tax Harvest Under Northam Expands Again
by Steve Haner With the release today of the April 2021 Virginia state revenue report, a correction in an earlier post becomes necessary. Overall general fund state tax collections are not up 26% so far compared to four years ago, they are up almost 30 percent. Corporate income tax collections are not up 68%, but…
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Northam Again Targets Virginia Business Taxpayers
By Steve Haner Washington giveth and Richmond taketh away. Once again, the Northam Administration wants Virginia to ignore business income tax changes made at the federal level because they would lower state revenue. Governor Ralph Northam’s finance secretary was in front of the House Appropriations Committee Friday explaining the reasoning and complaining that new federal…
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Conformity Article Errata, Semi-Mea Culpa
I got enough of importance wrong in yesterday’s post on state income tax policy that a real correction is required, not just a tweak to the existing previous post. Herewith what I know I got wrong: As Dick Hall-Sizemore pointed out, correcting me in a comment, the 2019 provision creating a new Taxpayer Relief Fund…
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Games Still Played with “Conformity Windfall”
By Steve Haner Sometimes you have to start the victory lap, even if you only get halfway around the track. A year ago, on Bacon’s Rebellion and in Thomas Jefferson Institute for Public Policy organs, I was beating the drum for a proposal to double the state’s standard deduction, the amount of family income exempt…
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Surplus? How About $455 Million Windfall Tax Hike
by Steve Haner Virginia ended the last fiscal year with about $797 million more in revenue than projected, and the Northam Administration credits $455 million of that to higher taxes on about 30% of taxpayers caused by conforming to the new federal tax law. More than 700,000 tax returns stopped claiming state itemized deductions, accounting…
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Federal Tax Conformity Flooding State With Cash
What will you do with your $110? Thanks to the conformity revenue flood, it’s coming. Checks are expected to arrive in October for most Virginia taxpayers, the most important piece of campaign mail they’ll get before November’s election. The $110 extra refund, $220 for a married couple, is the General Assembly’s response to the huge…
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Back to Taxaginia: Add A New Wealth Tax
The 2019 General Assembly is a dust storm in the rear-view mirror, but the four state tax increases that were discussed in “Taxaginia” last November are still in the road ahead. This post revises and extends my reporting on their status in this morning’s Richmond Times-Dispatch, featured on the Commentary section front. In a piece…
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Revised Again, Tax Bill Envisions Future Reforms
The possibility of additional future state tax reform or tax cuts improved Monday under a new version of the pending bill that puts Virginia into conformity with the federal Tax Cuts and Jobs Act. The resulting tax revenue not returned by the modest policy changes in this bill are to be held in reserve for…
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State Cap on Deductions Added To Tax Bill
The compromise income tax bill hailed for preventing a tax policy train wreck in Virginia includes one new provision not included in earlier bills, not mentioned in any of the Republican press releases and not yet included in any fiscal impact statements. Democrats wanted it. It is yet another departure from the new federal Tax…
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TCJA Remains A Big Revenue Gain for State
The tax relief proposals advancing in both the Virginia House of Delegates and Virginia Senate return at most half of the estimated additional state revenue created by the federal Tax Cuts and Jobs Act (TCJA) over six years. As Virginia leaders have debated what to do about the situation, all have been working off an…
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House, Senate Tax Policy Shootout Starts
The numbers to remember as the Virginia House of Delegates and State Senate start voting on income tax conformity bills, perhaps beginning tomorrow, have nothing to do with the hundreds of millions of dollars on the table or the millions of taxpayers waiting to file returns. The key numbers are 32 and 80. With an…
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Love The Middle Class? Index Virginia’s Taxes
Virginia’s most effective tax collector is inflation. Virginia’s long refusal to adjust any element of its income tax for slow but constant inflation means that each year, a slightly higher percentage of your growing income is taxed, and the rising costs of living shrink the value of the standard deduction and push more of your…
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GILTI And Other Tax Provisions Of Great Interest
In proposals which would further distance Virginia from the tax reforms of President Donald Trump, the General Assembly is being asked to let Virginia corporations keep two major deductions no longer allowed at the federal level. If the General Assembly agrees, the chance for a general corporate income tax rate reduction probably goes away. The…
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Tax Conformity Bills Buried in Rules Committee
The House Finance Committee will hold its first meeting of the 2019 General Assembly Monday morning, finally starting public discussion of Virginia’s response to a major federal tax overhaul from 13 months ago that will… No! Belay that! All House bills dealing with how Virginia conforms to that federal change, and what other policy changes…
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Are You In…The Hugo Zone?
Delegate Tim Hugo (R-Centreville) is the point person for a state income tax proposal centered on less-than-full conformity with the federal Tax Cuts and Jobs Act. It only helps a narrow subset of Virginia taxpayers, those in The Hugo Zone. We will now try to take you there. (If you want to imagine Rod Serling’s…