Constitutional amendment on car tax exemption passes as mandate

February 26, 2019

HJ 676 (Filler-Corn) and SJ 278 (Reeves) began and ended the session as mandatory personal property tax exemptions for one motor vehicle owned by a veteran with a 100 percent service-connected, permanent, and total disability, despite attempts to provide instead for a local option.  VACo and VML objected to creating another mandatory tax exemption, citing the current mandatory real property tax exemptions for disabled veterans and their surviving spouses and the surviving spouses of servicemembers who are killed in action, which together represented a $50 million revenue loss to localities statewide in 2018.

The House amended both resolutions to provide instead for a local option, but the Senate preferred the mandatory version.  The conference committee swiftly adopted the mandatory version, which was subsequently approved by the House and Senate.  During floor debate, senior members of the House strongly encouraged the patron to place parameters around eligibility in the implementing legislation that would be enacted in 2021 (assuming the resolution passes the 2020 General Assembly and is approved by the voters), such as by limiting the eligibility based on income or value of the motor vehicle exempted from taxation.

VACo Contact:  Katie Boyle

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