VB to eliminate machinery, tools tax

The City of Virginia Beach plans to phase out a tax on business machinery and tools, according to this article.

The machinery and tools tax, which is paid by about 200 manufacturing businesses, is estimated to generate $1.46 million in city revenue this fiscal year.

“It’s a hindrance to bringing new jobs into the city,” [Mayor Will] Sessoms said. The tax will be cut by a minimum of 20 percent a year until it’s gone, he said.

This move is in line with a push by various groups to eliminate both the machinery and tools tax and the business, professional and occupational license (BPOL) tax.

One thing is for certain: if Virginia Beach acts unilaterally to eliminate the tax, you can count on the other localities in the region following suit. We saw that happen with the boat tax. There is no way that any locality is willing to give another a competitive advantage.

Of course, what will also happen is that the localities will find a way to make up the revenue. My guess is that we’d see increases in the real estate tax rates, something we’ve experienced before.

Advertisements

2 thoughts on “VB to eliminate machinery, tools tax

  1. VBTA City Council candidates (Hedrick, Moss, and DeSteph) have been running on phasing out both the Machinery & Tools Tax and BPOL. The Mayor announces that the City plans to eliminate the lower hanging (BPOL generates about $50 million/year) to take an issue away from the challengers.

  2. Virginia is losing Doctors. Military dependents, military retirees, and seniors are unable to find reasonable medical care because many physicians not accepting new patients covered by TriCare or Medicare. Why not rebate a portion or all of the gross receipts tax (BPOL)for health care professionals that are actively accepting and maintaining TriCare/Medicare patients?

Comments are closed.