Tax legislation may not be the flashiest topic, but it touches just about everyone in Virginia. The state’s standard deduction is set to expire this year, and Republican and Democratic lawmakers who want to make sure it doesn't.
“It’s almost a billion dollars into the pockets of Virginians," said Republican Senate Minority Leader Ryan McDougle. "They get that today; we want to make sure they get that next year”
That’s on extending the standard deduction, a tax break that sets how much you can earn before the state taxes you. Right now, it's $17,000 for couples and $8,500 for individuals. But if the current provision is allowed to lapse, it could return to 2018 levels and take an estimated $600 more a year from your paycheck according to conservative analysts.
Republican bills to extend the measure have all died, but one from Democratic Delegate Vivian Watts sailed through committee with bipartisan support. It not only extends the standard deduction, it also sets it to inflation.
That means, as inflation increases your pay, the amount you can earn before the state taxes you goes up too.
“You get tax free on that, we’re not taxing it because of inflation,” Watts told Radio IQ.
It’s a plan Republican Delegate Joe McNamara said he’s pitched before and had killed by Democrats who now support the idea.
“It’s interesting that after last year and the year before and year before, after raising taxes on Virginians, they’re finally starting to wise up,” McNamara said.
But only a House version of the effort remains; that could make any standard deduction discourse part of secretive budget negotiations. Republican Senator David Suetterlein hopes whatever happens, Virginians see the money back in their wallets.
“It should be something that’s embraced by everyone," Suetterlein told Radio IQ. "we’ll see what happens” .
Both House and Senate budgets are set to be released this Sunday.
This report, provided by Virginia Public Radio, was made possible with support from the Virginia Education Association.
