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WEDNESDAY, JANUARY 11, 1995 0
Editorials
Tax Cuts
The list of spending cuts proposed by Gov. George Allen as amendments to the upcoming second year of the! biannual budget is only the first installment on what is intended to be a five-year, $2.1 billion reduction in state income taxes.
Basically the governor is proposing to increase the personal exemption from income taxes from $800 per person to $2,400 per person. The reductions announced so far would cover increasing it from $800 to $1,000.
What is less clear is how much local real estate taxes will have to be increased to make up for reductions in state spending. One small piece of this equation is clearly in place. The state constitution requires that Rappahannock County have offices for a Treasurer and Commissioner of Revenue^ The salaries for these constitutional officers and their assistants are set by the state compensation board. In the past the state has funded its estimate of half the cost of operating these offices.
Gov. Allen’s budget amendments would reduce the state contribution by 30 percent. The cost of operating the offices would not go down, so the county would have to come up with the difference through real estate taxes.
This is not an alarming increase, about one cent on the tax rate. But how much more will be passed off onto local taxes when the full amount of the income tax cut is taken into account in four more years?
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