Study: Cut Va. taxes
The rich may be rich and the poor may be poor, but a nonpartisan think tank says there’s a way to eliminate state income taxes on the poorest Virginians while providing as much as a 10 percent tax cut to everyone else.
The Thomas Jefferson Institute for Public Policy on Friday unveiled a plan to restructure Virginia’s tax system – which the group says could generate substantial economic growth.
The nonprofit group’s report recommends slashing certain business taxes and income taxes while expanding the sales tax to currently untaxed services.
“By expanding the current sales tax to most of the industries that do not currently collect it from their end-user individuals, every individual taxpayer can be substantially helped,” said Michael Thompson, president of the Thomas Jefferson Institute.
“The competitive business environment in Virginia can be enhanced, and our state and local governments would not lose a penny.”
The institute, based in Springfield, advocates a philosophy of “limited government, free enterprise and individual responsibility.” Its new economic study, “Tax Restructuring in Virginia: Revenue Neutral Path for Improving Virginia’s Economy,” was prepared by Chmura Economics and Analytics, a Richmond consulting firm.
“Basically, this is a collaborative team effort,” Xiaobing Shuai, Chmura’s senior economist, told reporters during a telephone news conference. “What Chmura Economics did in this study is go through probably 100-plus sales tax exemptions, and then try to estimate the value of those sales tax exemptions.”
A computer model developed by economists at the Beacon Hill Institute, an independent public policy foundation at Suffolk University in Boston, tested various scenarios for overhauling Virginia’s tax system.
Nine economic scenarios were put through the tax model.
“We took Chmura’s numbers, which is a static model that doesn't account for the positive economic benefits of the tax restructuring, and put them in our dynamic model and ran the nine scenarios that you see in the study,” said Paul Bachman, director of research at Beacon Hill Institute.
“The model resolves for new values, and we get new values for jobs, investment and disposable income. What we are doing, in economic terms, is shifting some of the tax burden away from businesses and households in some scenarios and putting it onto an untaxed service sector.”
Virginia currently exempts almost all services, from haircuts to auto repair, from sales taxes.
A major goal of the Thomas Jefferson Institute’s plan is to eliminate three taxes that business owners consider onerous and an impediment to creating jobs:
• The Business Professional Occupation Licensing tax, which is levied on gross receipts.
• The Machine and Tool tax, which is levied on equipment a business buys.
• The Merchants Capital tax, which is levied on a business’ inventory.
Virginia businesses must pay those taxes regardless of whether they make a profit. Thompson called them “job-destroying taxes,” saying they discourage businesses from expanding and hiring more employees.
The Thomas Jefferson Institute initiated its study to see if it was possible to eliminate those taxes and restructure the state’s tax system in a revenue-neutral manner that could improve Virginia’s economy.
The nine scenarios outlined in the study range from a relatively small impact to a radical overhaul.
The first scenario, for example, would simply eliminate the BPOL, M&T and Merchants Capital taxes and make up the revenue by extending the sales tax to certain currently untaxed services. The study said this would create 900 private-sector jobs.
Other scenarios suggested not only eliminating the three business taxes but also eliminating the lowest income tax bracket and cutting other personal income tax rates. Under these scenarios, the sales tax would be expanded to more services. In some scenarios, the sales tax would be cut, too. (It’s currently 4 percent for the state and 1 percent for local government.)
The scenarios did not specify exactly what types of services would be taxed. The study acknowledged that taxing medical bills, health insurance premiums, private school tuition and financial fees probably wouldn’t fly.
The more extensive scenarios would create at least 40,000 jobs, the study said.
Citizen Staff Reports 04/16/2015
Last summer, hundreds of Anthem LemonAid stands dotted Central Virginia and raised more than $100,000 in support of cancer treatment and research at Children’s Hospital of Richmond at VCU (CHoR). This July 17-19, Anthem is inviting community members to host an Anthem LemonAid stand in support of the children who are battling the disease. During the past 13 summers, Anthem LemonAid has raised more than $1 million. All funds raised support the Hematology and Oncology Clinic at the Children's Hospital of Richmond at VCU.
Anthem LemonAid is Children’s Miracle Network Hospitals’ signature summer event. It’s free to participate and is designed for children, families, community groups and businesses alike. > Read more.
Citizen Staff Reports 03/30/2015
The Henricopolis Soil & Water Conservation District will sponsor a tree seedling giveaway on April 2 at Dorey Park Shelter 1 from 2:30 p.m. to 6:30 p.m. and on April 3 at Hermitage High School parking lot from 8:30 a.m. to 1:30 p.m. Bare-root tree seedlings are available to Henrico County residents free of charge for the spring planting season.
The following seedling species will be available: apple, kousa dogwood, red maple, river birch, red osier dogwood, loblolly pine, sycamore, bald cypress, white dogwood and redbud. Quantities are limited and trees are available on a first-come, first-served basis. Each participant is allowed up to 10 trees total, not to include more than five of the same species. > Read more.
Citizen Staff Reports 03/30/2015
Wondering where to go to play Bingo? Wonder no more.
The Virginia Department of Agriculture and Consumer Services (VDACS) recently launched an online directory of permitted bingo games played in Virginia. Listed by locality, more than 400 regular games are available across the state. The directory will be updated monthly and can be found on VDACS’ website at http://www.vdacs.virginia.gov/gaming/index.shtml.
“Many Virginia charities, including volunteer rescue squads, booster clubs and programs to feed the homeless, use proceeds from charitable gaming as a tool to support their missions, said Michael Menefee, program manager for VDACS’ Office of Charitable and Regulatory Programs. > Read more.
It’s that time of year – charity races are popping up everywhere! On Saturday, St. Joseph’s Villa will be the site of the sixth annual CASA Superhero Run and the fifth annual Richmond Free to Breathe Run/Walk will be held in Innsbrook. Also in Innsbrook, the 2015 Richmond Take Steps for Crohn’s and Colitis will take place on Sunday. If you’re more into relaxation than exercise, check out Wine for Cure’s Dogwood Wine Festival or the Troubadours Community Theatre Group’s production of “West Side Story” at the Henrico Theatre. For all our top picks this weekend, click here! > Read more.
There are several fun events this weekend taking place outside including the third annual Virginia Firefighter Games at Short Pump Town Center; Twin Hickory Park’s “April Showers: A Celebration of Spring” event; the Young Life Richmond West 5k in Innsbrook; and the Gold Festival on Broad which benefits Prevent Child Abuse Virginia. Fingers crossed for no rain! For all our top picks this weekend, click here! > Read more.
The University of Richmond will host its annual Global Family Concert this weekend – a free, family friendly concert featuring Japanese, Indonesian, West African, Indian, and Brazilian music and dance performances. Country music fans can head to The Cultural Arts Center at Glen Allen for “An Evening of Country” featuring The Honky Tonk Experience. Enjoy the spring weather at Meadow Farm for “Sheep to Shawl” or join the Henrico Hiking Club at James River Park. For all our top picks this weekend, click here! > Read more.
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