Gillespie’s Tax Plan: A Win For Virginia’s Economy
Governor George Allen
The Roanoke Times
May 7, 2017
In 2017, the respected Tax Foundation’s ranking of Virginia’s tax climate dropped from 29th to 33rd worst in the nation. Virginians may not have noticed any changes — and that’s part of the problem. While sales taxes have increased, Virginia’s individual income tax rates haven’t been cut since the tax rates were first instituted way back in 1972, when I was on the University of Virginia football team. The Statler Brothers released “The Class of ’57,” and John Wayne was leading The Cowboys in movie theaters.
Clearly, much has changed since that time. Our neighboring states are taking major steps to strengthen their economies and boost job growth. Meanwhile, Virginia has remained mostly static.
That’s why Ed Gillespie put forward a detailed, thoughtful plan to change flip the script. His plan will cut individual income tax rates by 10 percent across-the-board. For the average family of four, economic modeling suggests that will result in an addition $1,285 of disposable income. These income tax rate cuts will provide immediate and tangible relief for all Virginians, along with benefits to our broader economy.
More than two-thirds of the Virginia economy is driven by consumer spending. Disposable income drives consumer spending, further strengthening the economic impact of this plan
That is just the start. For a long time, Virginia has struggled to end our dependence on Washington’s unpredictable spending. From civilian and defense spending in Northern Virginia, military spending in Hampton Roads and anti-coal policy imposed on Southwest Virginia, we’ve remained at the mercy of federal decisions largely outside of our control. Gillespie’s income tax rate cut plan will make Virginia more competitive and friendly to small business formation and job creation; and give us greater control over our own economic future.
Because the vast majority of Virginia businesses pay taxes through the individual income tax code this tax cut will immediately and directly benefit Virginia’s enterprising small business owners. By cutting individual income taxes, Ed’s plan will reduce taxes that most businesses pay, leaving them with more money to invest and grow in Virginia, and create more good paying jobs.
Rather than leave for our neighboring states with their more welcoming tax climates, Virginians would choose to stay here to start and grow their businesses, and the Commonwealth would find itself far more attractive to entrepreneurs looking for a place in which to start their businesses.
During my term as governor, economic development was my top priority. An important part of our efforts, working across traditional party lines, we cut Virginians’ taxes by more than $600 million. The result was that over 300,000 net new jobs in the private sector over those four years.
Much of our success in recruiting new investment and jobs in Virginia was driven by diversifying our economy and the recognition that the government does not create jobs; private citizens decide to create jobs. Private businesses do so best when the government puts in place the competitive tax and reasonable regulatory policies they need to be successful, and then gets out of the way. Ed’s plan is a clear blueprint to create an environment that allows all businesses to thrive and provide tremendous benefits for Virginians and the economy at large.
I know what it takes for a governor to implement serious tax reform: a clear, detailed plan driven by conservative principles, capable of finding broad support. I’ve closely reviewed Ed’s plan, and I can say with certainty, it meets these requirements. This plan will work, and more Virginians will get to work because of it.
Ed is the only candidate running for governor who has put forward such a substantive, detailed tax relief plan, showing Virginians exactly how it will function, and why it is so important to our Commonwealth’s future. Ed’s plan provides tax relief in a responsible manner that preserves and ensures funding for core functions of government including public safety, education, healthcare, and transportation.
To truly enact real, meaningful reforms you need both a plan, and a leader committed to its implementation. I know this is the right plan to grow Virginia’s economy and create good-paying jobs for our people. And I equally know that Ed is the trustworthy and optimistic leader who will work across party lines, listen to all Virginians, and get this positive, achievable plan passed into law. Virginia will be stronger and more vibrant for it.