Easier tax plan
Both commonwealth political parties are wrong regarding what to do with the income tax windfall that will accrue to Virginia that was created by the increase in the standard deduction in the new federal tax law.
The Democratic Party believes that government knows better than we scoundrels how to spend what we earn. The party is delighted that the federal tax change will result in a back door tax increase for many Virginians.
Since keeping all of that tax increase is, for the time being, unrealistic, it is willing to give up a small part of the windfall, provided it is given to people who pay no state income tax and therefore are likely to have contributed nothing to the windfall.
The Republican Party believes that we angels know better than the government how to spend what we earn. The GOP wants to eliminate the windfall by letting those who take the standard deduction on the federal tax return itemize their deductions on the state tax return.
It doesn’t matter that, since the deductions claimed on the state return would not appear on the federal return, the state Department of Revenue can no longer rely on the Internal Revenue Service to audit the deductions for the state as well.
After all, angels don’t cheat on their taxes.
If the parties truly wanted a realistic way to offset a portion of the windfall to those most likely to have generated it, all that they need to do is to reduce the tax rate applied to each of the state tax brackets and/or to raise the upper limits of the brackets.
The effect on state tax revenues of any proposed change to the rates or brackets can be estimated fairly precisely using historical tax data. George Gounley Newport News