Gov. Glenn Youngkin today signed legislation to conform Virginia’s tax code to the federal Internal Revenue Code, one effect of which will be to grant Virginia businesses impacted by the COVID-19 pandemic significant tax relief.
The legislation will allow Virginia expand and make retroactive tax benefits related to Paycheck Protection Program loans and Rebuild Virginia grants to ensure COVID-19 aid granted to businesses would not be treated as taxable income.
Bottom line: the measure is project to save Virginia individual and business taxpayers $201 million in taxes.
“The COVID-19 pandemic was one of the most difficult times for Virginians since the Great Depression. The federal government and the General Assembly came together to offer aid programs designed to keep businesses open and workers employed. While the worst parts of the COVID-19 pandemic are in the rearview mirror, many businesses are still struggling from the effects of unnecessary, forced economic shutdowns. This bill ensures programs designed to aid businesses don’t transform into tax liabilities that hinder Virginia’s economic recovery,” Youngkin said.
“Making our tax code more consistent with the federal government is not only the right principle, it is also good for business and good for everyday Virginians. This bill will save taxpayers over $200 million and provide much needed relief to small businesses. I appreciate Governor Youngkin and my colleagues in both chambers and in both parties working quickly to make these necessary reforms as tax season is underway,” said Del. Kathy Byron, the chief sponsor of the legislation.
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