Richmond– On Sunday, the money committees in the House and Senate released their respective budgets, which provide a sharp change of course from the budget outlined by former Governor Youngkin. While lawmakers rejected many of the former Governor’s proposed tax cuts and made several meaningful investments in housing, education, and support for working families, they failed to include any significant progressive revenue measures, most notably the fair share tax, a new tax bracket that would have asked the wealthiest Virginians to pay their fair share in taxes. By declining to advance these measures, lawmakers left significant revenue on the table that could have funded long-overdue investments in public education, affordable housing, healthcare access, and other critical pieces of social infrastructure.
“It is deeply disappointing that legislative leaders once again chose not to move forward with meaningful revenue reform,” said Ashleigh Crocker, Interim Executive Director of Progress Virginia. “The Fair Share Tax would simply ask the wealthiest Virginians to contribute at a rate more in line with what working families already pay in taxes. Instead of continuing to protect their donor class, lawmakers should be proactively guaranteeing that we have sustainable funding that ensures Virginia can be a place where all of their constituents can thrive. We cannot build a strong, inclusive economy if we refuse to modernize our tax code in deference to Virginia’s ten billionaires.”
Despite this missed opportunity, both chambers included several positive measures in their proposals.
The Senate proposal, with total appropriations of approximately $74 billion, includes:
- Ending the data center sales tax exemption, generating an estimated $1 billion in new revenue
- Small tax rebates for single and joint filers
- An increase in the standard deduction
- $50 million for affordable housing
- $50 million for an employer-match childcare pilot program
- 3% teacher pay raises
- Increased support for higher education
- Protections for Medicaid, including direct subsidies for individuals who lost ACA premium assistance
- Approximately $71 million in projected revenue from recreational cannabis
- Approximately $91 million in projected revenue from taxes on guns and ammunition
- Elimination of Governor Youngkin’s proposed tax cuts, preserving approximately $600 million in revenue
The House proposal, with total appropriations of approximately $71.5 billion, includes much of what the Senate proposed, plus:
- Significant direct investments in the Virginia Housing Trust Fund
- New funding to stabilize SNAP benefits in the event of federal funding disruptions
- Projected $265 million in revenue contingent on the legalization of skill games