Virginia has a two year budget, and so this year lawmakers were expected to approve legislation they like to call a caboose bill — the final car of a train that’s now two months late. The compromise announced Friday includes one-time tax rebates of $200 for individuals and $400 for joint filers.
It also raises Virginia’s standard deduction and reinstates the sales tax holiday.
Delegate Mark Sickles is a Democrat from Franconia.
"A couple of days ago, the governor said that he would sign a bill that didn't have any permanent tax cuts in it," Sickles says. "And the compromise bill is going to him with at least a $100 million dollars worth."
Lawmakers also agreed to more investments in education – including additional financial aid for college students.
Delegate Rip Sullivan of McLean says the proposed deal protects important priorities.
"This budget makes very clear that while we want to get money back to Virginians with some of the surplus, we're going to have money to spend on mental health and education," Sullivan says. "And then we will be responsible about not hobbling ourselves with unnecessary tax relief for corporations and wealthy Virginians."
Lawmakers are expected to return to Richmond in September to consider the proposed budget amendments. At that time, they’ll be able to offer amendments before it goes to the governor for any changes he wants to make.
In a statement, Republican House Speaker Todd Gilbert thanked the negotiators for their work on the agreement over the last six months. He also said, "We’re closer than ever before to providing real tax relief to Virginia families who are being squeezed by inflation and other skyrocketing costs, and providing historic levels of support for our schools."
Below is the full statement from the main negotiators on the deal in the House of Delegates and the Virginia Senate:
We are pleased to announce that we have a budget deal between the House and Senate budget conferees. While the major components have been agreed to, our conferees and staff will be completing the final touches in the days to come.
The deal is one that provides Virginians with additional tax relief and unprecedented investments in education, natural resources, and behavioral health. It is a win-win for the citizens of Virginia.
It includes a one-time tax rebate of $200 for individuals and $400 for joint-filers, increases the standard deduction ($8,500 for single-filers and $17,000 for joint-filers), removes the age requirement for the military retiree subtraction, and reinstates the sales tax holiday. Taken together, these actions provide relief to low- and middle-income Virginia citizens and Virginia businesses.
We also prioritized investments in education at all levels to ensure that our students recover from pandemic learning loss and are workforce ready. In higher education, we are providing additional operating support to maintain college affordability and increased financial aid to ensure access is not limited due to family income.
We were able to negotiate these investments while maintaining an eye on Virginia’s continued budgetary integrity. Virginia remains in a strong fiscal position based on these actions, which will continue to protect our triple-AAA bond rating.
While the negotiations have been deliberate and extended, we are very pleased that the outcome is both fair and balanced toward the priorities of the House and Senate. In an era when partisanship often prevails, the negotiations were cordial and respectful.
We owe a huge debt of gratitude to our dedicated conferees and talented staff.
Sincerely,
Barry D. Knight, Janet D. Howell and George L. Barker
