Governor Ralph Northam signed tax legislation on Friday that includes a nearly $1 billion tax cut and clears the way for the state to begin processing tax returns.
The bill marks a departure from Northam’s initial budget proposal. That plan, which was rolled out before the governor became embroiled in a scandal over blackface, called for the state to keep most of a $1.2 billion windfall caused by President Trump’s Tax Cuts and Jobs Act.
The bill he ended up signing includes tax rebates of $110 for individual filers and $220 for married couples. It raises the standard deduction by fifty percent beginning in tax year 2019.
Several black lawmakers in the House of Delegates spoke out against the tax cut earlier this week, saying it didn’t do enough to help low-income minorities.
“Systemic racism is real,” said Del. Marcia Price (D-Hampton ). “Equity is not codifying tax policy that would perpetuate large percentages of communities of color being stuck in impoverished situations.”
Republicans said the plan provided broad tax relief, including to those groups. Price voted against the bill, but other members of the Legislative Black Caucus eventually switched their vote after Republicans said they would consider increasing budget spending on education, eviction prevention, and other priorities of the caucus.
Secretary of Finance Aubrey Layne said on Thursday that the governor also wanted to see tax credits for low-income Virginians by making the Earned Income Tax Credit refundable, but his proposal was voted down by Republicans.
“What were we left with is, what is the best plan to help people making less than $50,000?” Layne said. “And that’s what we negotiated towards. The governor did not give up on the earned income tax credit. It was defeated in both the House and Senate committees.”