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.
Bail Bonds Chesterfield VA

Thoracic surgeon is first to perform 100 robot-assisted lobectomies in Central Virginia


Graham M. Bundy, a thoracic surgeon with HCA Virginia Physicians’ Cardiothoracic Surgical Associates, is the first such surgeon in Central Virginia to perform 100 minimally-invasive Da Vinci robot-assisted lobectomies (a surgical procedure to remove a lobe of the lung). The procedure is used to treat multiple types of conditions but is most often used to treat lung cancer. > Read more.

UMFS has urgent need for foster parents


UMFS officials say they have a desperate need for more foster families in the Richmond region and Central Virginia, especially those who would receive teenagers currently in the foster care system.

In recent years throughout the state, the number of children entering the foster care system has grown. > Read more.

VSP issues warning about automated traffic ticket email scam

Virginia State Police officials are warning Virginians about an email scam that tells people they are receiving an “automated traffic ticket” from the agency. State Police do not use or issue digital or automated traffic tickets or summonses, however. Anyone receiving such an email should delete it and not click on any links provided in the email, police said. > Read more.

READ Center offers free classes, training to low-literate people


One in six adults in Metro Richmond has literacy issues, and the READ Center in Henrico County is working to address the issue.

Next week – Sept. 24-30 – is Adult Education and Family Literacy Week, a time during which the READ Center is shining a light on its efforts to help some of the 35,000 adults in the region for whom reading, writing and basic math remain an elusive target. > Read more.

Play Day RVA planned for Sept. 21


The Richmond region will celebrate Play Day RVA Thursday, Sept. 21, with activities throughout the area to celebrate the opportunities that exist to play in the community. Dozens of employers, local governments, schools and community organizations will participate by hosting events that integrate playful activities into daily life and spread awareness of the value of active living. > Read more.

Henrico Business Bulletin Board

September 2017
S M T W T F S
·
·
·
·
·

Calendar page

tel:18772210315
tel:18772241804

Classifieds

Place an Ad | More Classifieds

Calendar

Christ Church Episcopal, 5000 Pouncey Tract Rd., will kick off a new season of ministry with music, fellowship and food on the church lawn from 4 p.m. to 7 p.m. This community-wide celebration will feature the bluegrass band East of Afton and the Keith Elgin Band, food trucks and low-key games for the young and young-at-heart. Bring lawn chairs and invite friends. For details, call 364-0394 or visit http://www.christchurchrichmond.com. Full text

Your weather just got better.

Henricopedia

Henrico's Top Teachers

The Plate