Bill > HB2333

This bill establishes a new income tax bracket for Virginia starting January 1, 2025, which introduces a 10 percent tax rate on income exceeding $1 million, while maintaining the existing tax rates for lower income levels. Currently, all income over $17,000 is taxed at 5.75 percent, but the new law will create an additional tier for high-income earners. Importantly, the revenue generated from this new tax rate will be specifically allocated: 50 percent will go to providing additional basic aid funding for public schools, 30 percent will be dedicated to the Child Care Subsidy Program administered by the Department of Social Services and the Virginia Department of Education, and 20 percent will be directed to the Virginia Housing Trust Fund. The bill includes a crucial provision stipulating that these new funds must supplement, not replace, existing funding for these programs, ensuring that the additional revenue truly increases resources rather than simply shifting existing budget allocations. This approach aims to generate additional state revenue while directly targeting funding for education, childcare, and housing support.

Budget and Finance

https://lis.virginia.gov/bill-details/20251/HB2333