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

Henrico Police to host prescription drug take-back event April 29


The Henrico County Division of Police and the U. S. Drug Enforcement Administration will participate in the nationwide Prescription Drug Take Back Program Saturday, April 29. The event will take place from 10 a.m. to 2 p.m. at the Henrico County Training Center, 7701 East Parham Road, next to the Public Safety Building.

The program is free and anonymous. Unused or expired pills, patches and liquid prescriptions (in their sealed original container) will be accepted. Needles and sharp items will not be accepted. No questions will be asked. > Read more.

Henrico home sales rose in March

Parts of the greater Richmond real estate market experienced an increase in the number of homes sold during the month of March, according to Long & Foster.

The number of homes sold increased in much of the Richmond region in March compared to year-ago levels. In Henrico County, the number of homes rose by 16 percent. Median sale prices varied in the Richmond region in March when compared to the same month last year. In both Hanover and Henrico counties, the median sale price rose by 10 percent. > Read more.

Henrico house fire contained quickly


APR. 24, 9:15 A.M. – A house fire in Henrico's West End Sunday caused minor damage but resulted in no injuries. At about noon Sunday, Henrico Emergency Communications Officers received phone calls of smoke coming from a home in the 1700 block of Shewalt Circle, just one block off Hungary Road. > Read more.

Business in brief


The Jenkins Foundation has granted The McShin Foundation $25,000 for residential recovery services to serve those with a Substance Use Disorder. The Jenkins Foundation is focused on equitable access to health care services, as well as programs that help reduce risky behaviors and promote safe and healthy environments. The McShin Foundation was founded in 2004 and is Virginia's leading non-profit, full-service Recovery Community Organization (RCO), committed to serving individuals and families in their fight against Substance Use Disorders. > Read more.

Early voting for Democratic nominations in Brookland, 73rd House districts tonight


APR. 24, 11:10 A.M. – Henrico Democrats will hold an early voting session tonight from 6 p.m. to 8 p.m. in two party caucus elections.

Democrats in the county are selecting a nominee for the Brookland District seat on the Henrico Board of Supervisors and a nominee for the 73rd District seat in the Virginia House of Delegates.

Danny Plaugher, the executive director of Virginians for High Speed Rail, and Courtney Lynch, the founder of the Lead Star leadership development organization, are seeking the Brookland District nomination. > Read more.
Community

YMCA event will focus on teen mental health


The YMCA, in partnership with the Cameron K. Gallagher Foundation and PartnerMD, will host a free event May 2 to help parents learn how to deal with teen mental health issues. “When the Band-Aid Doesn’t Fix It: A Mom’s Perspective on Raising a Child Who Struggles” will be held from 6:30 to 8 p.m. at the Shady Grove Family YMCA,11255 Nuckols Road. The event will focus on education, awareness, and understanding the issues facing teens today. > Read more.

Villa’s Flagler Housing wins national NAEH award


St. Joseph's Villa’s Flagler Housing & Homeless Services was one of three entities to earn the National Alliance to End Homelessness' Champion of Change Award. The awards were presented Nov. 17 during a ceremony at the Newseum in Washington, D.C.

NAEH annually recognizes proven programs and significant achievements in ending child and family homelessness.

Flagler completed its transition from an on-campus shelter to the community-based model of rapid rehousing in 2013, and it was one of the nation's first rapid re-housing service providers to be certified by NAEH. > Read more.
Entertainment

Restaurant Watch


Find out how your favorite dining establishments fared during their most recent inspections by the Virginia Department of Health. > Read more.

 

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The WAY, located at 2 E. Williamsburg Rd. in Sandston, will hold its first Easter Grand Gathering event from 7 a.m. to 2 p.m. There will be a yard sale, vendor sale, bake sale, community lunch with hamburgers and hot dogs, music and silent auction. Kid’s activities starting at 11 a.m. include games, bounce house, arts and crafts, Easter egg hunts, face painting and more. Open to the community. Proceeds benefit The WAY. For details, call 737-3300 or search “The WAY” on Facebook. Full text

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