VA Governor Youngkin budget proposal: make service tips exempt from taxes

Virginia Governor Glenn Youngkin announced a budget proposal Monday that would make service tips exempt from the state’s income tax. A release from Youngkin’s office claimed the proposal would return an estimated $70 million to Virginians if approved. Estimates by the Virginia Department of Taxation and Virginia Employment Commission found that the proposal would benefit more than 250,000 people in the state. Those include people working in the food service, personal service and hospitality industries. Compliance would be ensured by the Department of Taxation’s use of IRS information and employer-reported W-2’s.