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2004 SPECIAL SESSION I

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HB 5012 Tax reform; changes in provisions of sales & use tax exemp. for public serv. corp., income tax, etc.

Introduced by: Phillip A. Hamilton | all patrons    ...    notes | add to my profiles

SUMMARY AS INTRODUCED:

Omnibus tax bill. Modifies numerous state and local taxes as follows: (i) eliminates most sales and use tax exemptions for public service corporations; and (ii) establishes a flat individual income tax on all taxable income if the Virginia taxable income of the family (the individual, and if married, the individual and his spouse) exceeds $150,000. The rate of the flat tax is 5.75 percent for the 2004 and 2005 taxable years. Beginning January 1, 2006, the 5.75 percent flat tax would be indexed annually to increases in the Consumer Price Index; however, the rate of the flat tax would be capped at 6.5 percent. The bill would not change the rate of income tax for taxpayers with $150,000 or less in taxable income. Other changes are that the bill (iii) tightens certain corporate income tax loopholes; (iv) increases the recordation tax by five cents; (v) increases the state cigarette tax to 25 cents per pack; (vi) increases the tax on liquor by three percent; (vii) increases the car rental fee by three percent; (viii) increases the motor vehicle titling tax to 3.5%; (ix) increases the motor vehicle registration fee by five dollars; (x) increases the motor vehicle inspection fee by five dollars; (xi) eliminates the estate tax on estates of persons who die after September 30, 2005; and (xii) authorizes localities to impose an additional one-half percent local sales and use tax, but the additional revenues generated by such tax shall not diminish or replace allocations or appropriations for education purposes made by any locality; such additional revenues shall be supplemental to such allocations or appropriations.


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