Tax News

CCH (cch.taxgroup.com) reports:

  Virginia Gov. Timothy M. Kaine has unveiled a 2010-2012 biennial budget that includes a proposal to end the annual $950 million local personal property car tax payment that the state makes to localities to offset some portion of local car tax bills for the first $20,000 in value of personal vehicles. He also recommended getting rid of the car tax completely and suggested that the right way to do this was to impose a 1% personal income tax surcharge in Virginia and give 100% of the revenue to local governments in exchange for their agreement to completely eliminate the property tax on all personal cars, trucks, and motorcycles.

  The proposed budget assumes revenue due to an increase in the monthly landline and wireless E-911 fees and captures revenue from a proposal to increase the gross premium insurance tax applicable to property and casualty insurance. Further, the budget proposes to eliminate the sales tax dealer discount for retailers.

  In addition, Virginia will join 20 other states and decouple corporate income taxes from the federal income tax deduction for domestic production activities that are allowed under §199 of the Internal Revenue Code. The governor also proposed moving the date of conformity for taxpayers to file their taxes.

  The governor's news release can be found at
http://www.governor.virginia.gov/MediaRelations/NewsReleases/viewRelease.cfm?id=1172.

News Release, Virginia Gov. Timothy M. Kaine, December 18, 2009