Your Turn — Surplus should be used for tax rebates
Published 8:55 am Friday, August 26, 2022
The House and Senate Joint Money Committees met on Friday, August 19. Governor Glenn Youngkin began the meeting with announcements regarding Virginia’s tax collections. Currently at nearly $2 billion above projections, Governor Youngkin stated that his administration intends to seek $400 million in a new taxpayer relief fund for Virginia residents in the 2023 proposed budget. The primary goal being to assist families and small businesses across the Commonwealth that are still struggling with record-high inflation.
The excess in tax revenues comes primarily from non-withholding taxes, such as taxes on capital gains, interest, dividends, IRA distributions, partnerships, S-corps, and self-employed individuals. According to Secretary of Finance Stephen Cummings, this stems from an astonishing 71% rise in collections between 2019 and 2022. Non-withholding collections are heavily correlated with stock market returns. It should also be noted that corporate taxes experienced a 110% gain in the same period.
A financial review given by Secretary Cummings illustrated a generous growth of 36% in General Fund revenues since 2019, which was attributed to a better than expected rebound from the pandemic and structural changes to Virginia’s workforce. Secretary Cummings gave a few reasons for this: wage growth and changes in job mix, strong sales tax revenue from the reopening of the economy and growing corporate profitability.
The General Fund surplus will mostly be used to provide tax rebates for excess taxes paid by individuals in 2021. There will also be a $905 million deposit into the Virginia Revenue Stabilization Fund. Also known as our state’s Rainy Day Fund, it allows us to better prepare for future downturns and help prevent crippling cuts to core services during our biggest times of need. Other contingent appropriations include funding for the I-64 expansion project, capital project overruns such as repair and emergency maintenance of county roads and walkways, and economic development incentives.
Virginia’s employment rate has grown by 2% in the current fiscal year 2022. Despite this rise in employment, we remain below the pre-pandemic levels of employment. Nonetheless, the competitive job market will help us continue the path of withholding growth in 2023. Earnings growth has still outpaced overall employment growth and individual refunds were lower than planned.
The Virginia Department of Conservation and Recreation has extended the time for its Virginia Outdoors Survey (originally to be cut off on Aug. 15). Responses from the survey will be used to formulate the 2023 Virginia Outdoors Plan. Any Virginia resident over 18 is encouraged to take this voluntary and confidential survey. You can find the link for the survey and previous Outdoors Plans at https://www.dcr.virginia.gov/recreational-planning/vop.
While you’re there, the DCR’s website is also a great resource for finding information about Virginia’s State Parks, trails, public water access, and much more about our state’s natural heritage and what the DCR does to keep it preserved and protected.
If you’re looking for a fun outdoor event this weekend, The Great American Family Picnic presented by Bob Good for Congress is taking place in Congressman Good’s home county in Concord on Saturday, Aug. 27. Hosted by Beckie and Paul Nix at Mountain View Lodge, the event will include hayrides, games for all ages, an apple pie contest, and live music. The lodge is located at 53 Sleigh Ride Circle, Concord (in Campbell County). The event kicks off at 5 p.m. with a 5:30 dinner including hotdogs and hamburgers. Guests will want to bring picnic blanket and chairs.
Del. C. Matthew Fariss represents Buckingham in the Virginia House of Delegates. His email address is DelMFariss@house.virginia.gov.