RICHMOND, Va. (WRIC) — Governor Glenn Youngkin has signed a bipartisan bill into law that will exempt small businesses from paying taxes on COVID relief grants.
The amendments to the state tax code, passed as HB971 with unanimous support in the House and Senate, bring the state in line with Federal tax policies passed as part of President Joe Biden’s American Rescue Plan Act.
“This bill ensures programs designed to aid businesses don’t transform into tax liabilities that hinder Virginia’s economic recovery,” Governor Glenn Youngkin said in a statement.
The policy means that small businesses that received a paycheck-protection loan or restaurant revitalization grant will not have to pay federal or state taxes on the money.
Delegate Kathy Byron (R – Bedford). the bill’s patron, said in a statement, “Making our tax code more consistent with the federal government is not only the right principle, it is also good for business and good for everyday Virginians.”
The bill included an emergency clause, and will go into effect immediately.