Youngkin proposes to provide tax relief on tips and cars

Governor Youngkin recently included a provision in his budget proposal to provide tax relief on tips and cars—measures his Republican administration has promoted as ways to return money to middle- and lower-income workers.

The proposal, which would amend the final year of the state’s two-year budget cycle, also seeks to increase funding for schools, maternal health, and disaster relief. According to an adviser for Youngkin, the proposed adjustments are supported by surplus funds from fiscal year 2024.

“We reopened Virginia’s economy after a global pandemic, all while delivering surplus after surplus after surplus,” Youngkin said during a presentation to the General Assembly’s money committees. “As a result of our work together, Virginia is growing, Virginia is leading, and Virginia is winning.”

Budget proposals introduced by governors typically undergo revisions by the money committees before being put to a vote by lawmakers. With Democrats expected to maintain control of both General Assembly chambers after special elections in January, Youngkin’s priorities may depend heavily on bipartisan cooperation.

Democratic House of Appropriations Chair Luke Torian said on Wednesday that none of Youngkin’s proposed amendments are off the table. He noted that the state has an estimated $2 billion to $3 billion in surplus funds but emphasized the importance of strategic spending, particularly in the event of an economic downturn in the future.