In Fiscal Year (FY) 2013, Virginia collected $34.4 billion in state and local taxes. While this is an impressive sum of money, it tells us little about whether or not the average Virginia taxpayer can afford this level of taxation.
As shown in Chart 1, Virginia’s state and local tax burden (tax collections divided by personal income) was the 7th lowest in the nation for FY 2013 at 8.6 percent—this is -17 percent below the national average of 10.3 percent. As shown in Chart 2, the tax burden has grown over time by 41 percent to 8.6 percent in FY 2013 from 6.1 percent in FY 1950.
Virginia’s low tax burden is not driven by any particular element in their tax code. While Virginia’s individual income tax burden in high relative to the national average (2.7 percent, 16th highest in the country), it is more than offset by a low sales tax burden (1.2 percent, 45th highest in the country). The remaining taxes (property, corporate income, and all other) are all below average.
Of course, the tax burdens for local government can vary just as much as they do among the 50 states. As such, we have also calculated the local government tax burden for every county in Virginia—this includes every taxing jurisdiction within the geographic county borders whether it is a city, a special district, or county government itself.
The Virginia counties with the highest local government tax burden include: Surry County, VA (8.5 percent), Bath County, VA (6.7 percent), and Buchanan County, VA (5.8 percent). The Virginia counties with the lowest local government tax burden include: Amelia County, VA (1.8 percent), Lee County, VA (1.9 percent), and Nottoway County, VA (1.9 percent).
J. Scott Moody has nearly 20 years experience as a public policy economist with a specialty in tax policy and has over 180 publications. He has worked for numerous national and state-based think tanks such as the American Conservative Union Foundation, Federalism In Action, Tax Foundation, Heritage Foundation, and The Maine Heritage Policy Center.