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SB 530 Tax reform; changes in provisions for income tax, sales & use tax, cig. tax, per. prop. tax, etc.

Introduced by: Emmett W. Hanger, Jr. | all patrons    ...    notes | add to my profiles


Taxation; omnibus tax plan. Sets out the tax plan which would (i) increase the personal exemption amount from $800 to $2,500, and increase the standard deduction amount to $3,500 for singles and married filing separately and to $7,000 for married filing jointly, and raise the filing thresholds to $7,000 and $13,000, (ii) make food fully subject to sales and use tax but provide a refundable tax credit for the sales tax paid on food equal to $40 per person, (iii) tighten certain corporate income tax provisions, (iv) increase Virginia's state cigarette tax to 30 cents per pack, distribute all state cigarette tax revenues to local governments, and repeal all local cigarette taxes, (v) beginning January 1, 2005, provide personal property tax relief at 100 percent on personal use vehicles, regardless of vehicle value, (vi) conform the amount of Virginia estate tax due from an estate to the maximum amount of the federal estate tax credit for state estate taxes, (vii) end the accelerated sales tax collection for retailers, (viii) increase the retail sales and use tax by one-half percent to five percent, (ix) change Virginia's individual income tax brackets and add a six percent and 6.5 percent income tax bracket, (x) make the age deduction dependent upon federal adjusted gross income, and (xi) increase the tax on motor fuels by an additional five cents per gallon.

The bill also amends 58.1-3833 by authorizing a local meals tax of up to four percent in counties. This section already reads that the local meals tax in counties shall not exceed four percent. However, the section, as published, is incorrect. It includes language setting the local meals tax rate, which amendatory language was dependent upon passage of the 2002 transportation referendums (See Chapter 853 of the Acts of Assembly of 2002). As the referendums did not pass, such amendatory language never became law. The change to 58.1-3833 is technical in nature. It sets out the Code section as it should have been published and amends the section to clarify current law that authorizes counties to impose a local meals tax up to four percent.