Henrico County VA

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.
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HandsOn Day set for Oct. 17

HandsOn Day 2015, which will feature 1200 volunteers serving more than 65 nonprofits in Greater Richmond, will take place Oct. 17 from 9 a.m. to 1 p.m. Among the projects in Henrico or surrounding communities that need volunteers are: installing GardenFest lights Lewis Ginter Botanical Garden, distribution center assistance at Feedmore, pumpkin carving with residents at SupportOne, work and play at Housing Families First, paint for independence at Heart Havens, spruce up the shelter and clean sweep at Harbor House at Safe Harbor, pinwheel project at REAP and Kidney Walk prep at National Kidney Foundation Serving VA. > Read more.

Online tool helps identify best native plants for pollinators

Virginians who want to plant beneficial plants for bees, butterflies and hummingbirds have a new resource at their fingertips. The online Virginia Native Plant Finder now lets users search for native plant species that benefit pollinators. The tool, which is managed by the Virginia Natural Heritage Program, is free and easy to use; searches can be completed on desktops, tablets or smartphones.

Native plants are those that grow where they evolved; they have traits that enable them to adapt to local conditions. The Virginia Native Plant Finder lets users create their own custom native plant lists by selecting from dropdown menus. > Read more.

The Volunteers of the United States Army Field Band to perform Oct. 15

Henrico County Recreation and Parks is hosting a concert by The Volunteers of the United States Army Field Band on Thursday, Oct. 15 at Henrico Theatre, 305 East Nine Mile Road in Highland Springs. This free concert will be held at 7 p.m. and will feature Soldier-Musicians from the U.S. Army Field Band.

Since its inception in 1981, The Volunteers has been telling the Army story through rock, pop, country, and patriotic music. Its members have performed for millions of listeners in all 50 states, Puerto Rico, Canada, Mexico, Kuwait, and Iraq. This group tours more than 100 days each year, bringing a powerful message of patriotism and support to communities large and small. > Read more.


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Richmond Apartment Owners Association’s monthly luncheon meeting will be held at 12 p.m. at The Westwood Club, 6220 West Club Ln. The Richmond Fire Marshall will present “Landlord Requirements.” Cost… Full text

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