Virginia General Assembly enacted House Bill 873

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Virginia General Assembly enacted House Bill 873
House Bill 873 Makes Changes to Virginia's Port Income Tax Credits.

During the 2014 session, the Virginia General Assembly enacted House Bill 873, which makes the following changes to Virginia’s port income tax credits:

Barge and Rail Usage Tax Credit:

  • Decreases the annual credit cap from $1.5 million to $500,000.
  • Expands the type of cargo that qualifies for the credit to include roll-on/roll-off cargo.
  • Requires the Department to annually provide information to the Virginia Port Authority regarding the Barge and Rail Usage Tax Credits issued.
  • Allows qualifying taxpayers to claim the Port Volume Increase Tax Credit for the same cargo for which a Barge and Rail Usage Tax Credit was claimed, provided such taxpayers meet the criteria of both credits.

International Trade Facility Tax Credit:

  • Decreases from 10 percent to 5 percent the required increase in cargo transported through Virginia maritime port facilities necessary to qualify as an international trade facility.
  • Expands the type of cargo that qualifies for the credit to include noncontainerized cargo and roll-on/roll-off cargo.
  • Increases the annual credit cap from $250,000 to $1.25 million.
  • Eliminates additional tax credits for international trade facilities that create new jobs or make capital investments in a tobacco dependent locality.
  • Requires the Department to annually provide information to the Virginia Port Authority regarding the International Trade Facility Tax Credits issued.

Port Volume Increase Tax Credit:

  • Expands the type of cargo that qualifies for the credit to include roll-on/roll-off cargo.
  • Allows qualifying taxpayers to claim the Barge and Rail Usage Tax Credit for the same cargo for which a Port Volume Increase Tax Credit was claimed, provided such taxpayers meet the criteria of both credits.

Accordingly, the Virginia Department of Taxation (“the Department”) will publish updated guidelines for the port income tax credits to reflect the 2014 legislative changes, described above.  You can view a description of these guidelines, as well as a detailed work plan, on the Virginia Port Tax Credit Guidelines website.  Draft guidelines, public comments, and other information will be posted on this website in the future.

 

To improve government transparency and facilitate the development process, the Department will allow a 60-day comment period immediately after a public draft has been distributed.  This comment period begins May 12, 2014 and will continue through July 11, 2014.  Please submit any comments regarding the development of these guidelines via e-mail to michael.mariani@tax.virginia.gov.

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