The Retail Advocate 12.15.22
Governor Youngkin Proposes Reducing Corporate Tax Rate
Governor Glen Youngkin announced his budget amendments for the 2023-2024 Biennium. The money committees from both the House and the Senate gathered to listen as the Governor outlined his priorities for the upcoming year. We are continuing to comb through the 700-page budget for any items that impact the retail industry, however, an overview of the Governor’s tax plans is below.
Governor Youngkin has proposed reducing the corporate tax rate from 6% to 5%. The Governor did state that his goal is to reduce the rate down to 4% by the end of his term.
He is also proposing a 10% deduction on business income for small businesses. In addition, he is doubling the standard deduction for individuals and married couples, to $9,000 and $18,000, respectively. He also announced his plan to reduce the individual income tax to 5.5%.
Governor Youngkin also included funding for the Organized Retail Crime Task Force should that legislation pass during the 2023 General Assembly Session.
Minimum Wage Increase to Take Effect January 1
Virginia’s state minimum wage is set to increase to $12 per hour, effective January 1, 2023. This is the third increase as a result of legislation passed during the 2020 General Assembly.
Grocery Tax Reduced Effective January 1
The sales tax rate on groceries (food for home consumption and certain essential personal hygiene items) will be reduced to 1% beginning January 1, 2023.