Tax restructuring; modifies individual income and retail sales and use taxes. (HB729)

Introduced By

Del. Scott Lingamfelter (R-Woodbridge)


Passed Committee
Passed House
Passed Senate
Signed by Governor
Became Law


Tax restructuring. Modifies the individual income and retail sales and use taxes by lowering the top three individual income marginal tax rates, increasing the individual income tax filing thresholds, repealing the retail sales and use tax on food, increasing the state retail sales and use tax from 4.3 percent to 5.0 percent except in the counties and cities located in the Hampton Roads and Northern Virginia Planning Districts, extending the retail sales and use tax to certain personal services that are currently exempt from the tax, and eliminating the retail sales and use tax exemption for nonprofit entities with at least $1 million in gross revenue. The bill lowers the tax on individual income (i) in excess of $17,000 from 5.75 percent to 5.5 percent, (ii) between $5,000 and $17,000 from 5.0 percent to 4.9 percent, and (iii) between $3,000 and $5,000 from 3.0 percent to 2.95 percent. The bill increases the income threshold at which at an individual income tax return must be filed from $11,950 to $15,000 for single persons and from $23,900 to $30,000 for married persons. The bill increases the state retail sales and use tax from 4.3 percent to 5.0 percent throughout Virginia except in Hampton Roads and Northern Virginia. The end result would be a 5.0 percent state retail sales and use tax in all regions of the Commonwealth beginning in 2015. An amount equal to the revenues generated by the increase would be distributed from the Transportation Trust Fund to each planning district in the Commonwealth in which the revenue was generated to be used solely in the planning district for new construction projects on new or existing roads, bridges, and tunnels or mass transit. The retail sales and use tax increase would become effective on January 1, 2015, and the individual income tax changes would become effective for taxable years beginning on and after January 1, 2015. Read the Bill »


Bill Has Failed


01/07/2014Prefiled and ordered printed; offered 01/08/14 14100650D
01/07/2014Referred to Committee on Finance
01/22/2014Assigned Finance sub: Subcommittee #3
01/23/2014Impact statement from TAX (HB729)
01/24/2014Subcommittee recommends continuing to 2015
01/27/2014Continued to 2015 in Finance
12/04/2014Left in Finance