H.B.222. Income tax, corporate & state; modification for certain companies & subtraction for their employees.

Virginia House of Representatives
Last action 12 days ago
Polls (open):

Summary

                    Establishes an income tax modification for companies that, from 2018 through 2028, either (i) invest at least $5 million in new capital investment in a qualified locality and create at least 10 jobs paying at least twice the minimum wage in a qualified locality or (ii) create at least 50 jobs paying at least twice the minimum wage in a qualified locality. A company is eligible to claim the modification only if it had no property or payroll in Virginia on the effective date of the act.

The bill defines "qualified locality" to include (a) the Counties of Bland, Buchanan, Carroll, Craig, Dickenson, Giles, Grayson, Lee, Russell, Scott, Smyth, Tazewell, Wise, and Wythe and the Cities of Bristol, Galax, and Norton; (b) the Counties of Amelia, Appomattox, Buckingham, Charlotte, Cumberland, Halifax, Henry, Lunenburg, Mecklenburg, Nottoway, Patrick, Pittsylvania, and Prince Edward and the Cities of Danville and Martinsville; (c) the Counties of Accomack, Caroline, Essex, Gloucester, King and Queen, King William, Lancaster, Mathews, Middlesex, Northampton, Northumberland, Richmond, and Westmoreland; and (d) the City of Petersburg. "Qualified locality" also includes certain real property owned or partly owned by such localities outside of their territorial boundaries.

The bill requires a company to obtain annual certification from the Virginia Economic Development Partnership Authority (the Authority) that the company will have a positive fiscal impact on Virginia, based on consideration of certain factors. It directs the Authority to deny certification to any company that reorganizes for the purpose of taking advantage of the tax benefits provided by the bill.

Generally, the amount of the modification is the value of the company's property and payroll in qualified localities. The bill provides similar modifications for industries that use different apportionment formulas, including motor carriers, financial companies, construction companies, railway companies, manufacturing companies, retailers, and businesses with enterprise data center operations.

The bill also establishes a subtraction from individual income tax for employees of an eligible company. Such employees may subtract up to $250,000 of compensation received from an eligible company. Eligibility for the corporate and individual income tax subtractions shall continue for nine years following the year in which the company initially makes a modification to its apportionment formula. Continuing eligibility is contingent on the company's maintaining its capital investment and jobs created in qualified localities.

The bill permits qualified localities to provide grants and loans to companies that qualify for the modification provided by the bill.
                

In an effort to be an unbiased source of information, all text in this summary comes directly from government resources.

Actions

  • Read third time and passed House (87-Y 12-N)

    Tue, Feb 13th 2018
  • Amendments by Delegate Habeeb agreed to

    Mon, Feb 12th 2018
  • Printed as engrossed 18106663D-EH2

    Mon, Feb 12th 2018
  • Engrossed by House - committee substitute with amendments HB222EH2

    Mon, Feb 12th 2018
  • Pending question ordered

    Mon, Feb 12th 2018
  • Read second time

    Mon, Feb 12th 2018
  • Committee substitute agreed to 18106663D-H2

    Mon, Feb 12th 2018
  • Amendment by Delegate Morefield agreed to

    Mon, Feb 12th 2018
  • Read first time

    Fri, Feb 9th 2018
  • Draft Subcommittee substitute printed to LIS only 18106663D-H1

    Mon, Feb 5th 2018
  • Assigned Finance sub: Subcommittee #2

    Tue, Jan 30th 2018
  • Referred to Committee on Finance

    Fri, Dec 29th 2017
  • Prefiled and ordered printed; offered 01/10/18 18100385D

    Fri, Dec 29th 2017