Virginia Gov. Glenn Youngkin is doubling down on his plan to cut income taxes across the state, despite the fact that Democrats, who hold control of the General Assembly, have been skeptical of the idea.
“I think we’ve got a very good starting place,” Youngkin said in an interview with WTOP. “I have been encouraged by the level of discussions that we’ve had.”
Youngkin’s proposed budget would cut state income taxes by 12% “across the board.” He said the lowest tax bracket of 2% would be reduced to 1.75%, while the highest bracket would drop from 5.75% to 5.1%.
The Republican governor said the personal income tax burden on Virginians would fall by $1.1 billion in fiscal year 2025 and $2.3 billion in fiscal year 2026.
The cuts would be offset, the governor said, by a 0.9% increase in the state sales tax, from 4.3% to 5.2%.
Revenue also would come in from a sales tax expansion to digital services, such as downloading music.
“I don’t think there’s any way that the Democrats will agree to a sales tax increase in Virginia, largely because they think that’s a regressive tax that hurts poor people,” said Bob Holsworth, a Virginia political analyst.
On Wednesday, Democratic Sen. Scott Surovell, the majority leader in Virginia’s Senate, called the tax cuts “unrealistic” and a “nonstarter” for Democratic leaders.
When asked about that, Youngkin said, “We’ll have to see.”
“There’s a lot of places that we agree on where some of our team will vote with them, and some of their team will vote with us,” Youngkin said. “The key is that we listen to each other and that we sit in a room and we find the best solution.”
Tax policy changes were a key part of what turned into a six-month budget stalemate last year, with Youngkin and Republican lawmakers arguing for an additional $1 billion in permanent tax cuts, including a reduction in the corporate tax rate.
“I’m hoping that the budget will get done on time,” Youngkin said. “Democrats control the House Appropriations Committee and they control the Senate Finance Committee, they’ll work with us and I’m optimistic.”
The Associated Press contributed to this report.
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