Joint Money Committees Update
Last week, Governor Northam and Secretary of Finance, Aubrey Layne, addressed the Joint Money Committees with a Review of the 2018 Fiscal Year and a look forward to the coming Fiscal Year.
During their presentation, both Governor Northam and Secretary Layne discussed the $550 million surplus in the budget as well as the Federal Tax changes and what the Governor would like to see the Commonwealth do to conform. It was clear that they would like to see simple conformity (conformity in definition only), and would like to leave any actual tax policy changes as a separate issue so that conformity does not get wrapped up into a policy debate. It was suggested by Secretary Layne that it would not be necessary to have a Special Session in order to achieve conformity, as long as the legislation was handled immediately upon the start of the 2019 Session and there was an Emergency Clause on the legislation. In addition, Governor Northam discussed how he would like the surplus money allocated. To view the entire committee meeting click here.
This leaves many questions unanswered
It seems clear that both the General Assembly and the Governor would like to see conformity with the Federal Tax cuts, the question now becomes how and when. By how, we mean will the General Assembly agree with the Governor that simple conformity is all we need, or will they insist upon more policy-based tax reform? And by when, we mean will the General Assembly request a Special Session to accomplish Tax Reform, or will they try to accomplish this at the beginning of the 2019 Session?
What Virginia Retail Federation is doing
The issue of tax reform, especially with regard to specific taxes that impact our members, has been something VRF has advocated in support of for many years. We are meeting with Leadership in the General Assembly as well as with the Administration to discuss what is a priority for our members.