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A look at how Virginia could be impacted by Youngkin tax cuts

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Steve Helber/AP
/
AP
Virginia Gov.-elect Glenn Youngkin speaks to the media after a transition luncheon in front of the Governor's Mansion at the Capitol in Richmond, Va., Thursday, Nov. 4, 2021. (AP Photo/Steve Helber)

Republicans are about to take control in Richmond. And, they're hoping to deliver on their campaign promises.

Republican Glenn Youngkin campaigned on a platform of cutting taxes, and now he's working with Republicans in the General Assembly to eliminate the grocery tax, press the pause button on a gas tax increase, double the standard deduction and give one-time rebates.

Chris Wodicka at the Commonwealth Institute says all that adds up to about three billion dollars.

"For a couple of the proposals around the sales tax that applies to groceries and the fuels tax increase, those revenues are already dedicated to specific things," explains Wodicka. "And so those are the areas that would see a hit potentially."

Areas like public education, transportation projects and local government. Stephen Haner at the Thomas Jefferson Institute says the tax cuts can be financed with budget surpluses.

"So you don't actually have to eliminate or cut that much to do this. As a matter of fact, you can probably do it without cutting anything," says Haner. "What you can't do is keep growing government at 5, 6, 8, 10, 12% a year, which is what some people would like to do."

Youngkin has some help from outgoing Governor Ralph Northam, who agrees that Virginia should scrap the grocery tax and send a one-time rebate to taxpayers. If Youngkin wants to double the standard deduction or press the pause button on the gas tax hike, he'll have to persuade lawmakers to add those tax cuts to the budget he'll be inheriting from Northam.

This report, provided by Virginia Public Radio, was made possible with support from the Virginia Education Association.