eNews: Action Alert – Feb. 3, 2020Sunday, February 02, 2020 - 10:28am
Tax equalization bill may freeze local cigarette taxes!
Cities and Towns
Current GA Committee:
The Senate Finance and Appropriations Committee is working to collapsing into a single measure the multiple proposals dealing with modernizing county taxation powers.
In a move late last week that surprised many, Senator Hanger offered a substitute bill that while allowing counties to impose cigarette taxes would freeze the tax rate for cities, towns and counties:
Committee Chair Senator Howell did not ask for a vote on the measure. Instead, she directed the Joint Legislative Audit and Review Commission (JLARC) to review the measure and report back this week to Senate Finance and Appropriations.
The Committee is likely to act early this week.
The likely vehicle is Senator Hanger’s SB588.
In the House, a similar measure offered by House Finance Chair Delegate Watts, HB785, is likely to be heard today in House Finance Subcommittee #2 and then by the full House Finance Committee on Wednesday.
However, the House bill, as introduced, does not include the damaging language.
It is important for VML members to alert their senators about the cigarette tax gambit. It is difficult to understand how these restrictions comport with the bill’s intent to improve local finances.
Please contact your senators and use the Key Points below to register your opposition to SB588 in its present form.
In the substitute version of SB588, Virginia’s cities and towns would lose future tax flexibility, meaning local governments would become even more dependent upon real and personal property taxes.
It is important that localities have the ability to set the tax rate on cigarettes to suit the specific needs of each locality.
The intent of SB588 is to modernize and provide greater taxing authority and flexibility for counties. It is counter to the bill’s true purpose to insert language that restricts that very same authority and flexibility for Virginia’s cities and towns.