Youngkin demands nearly $400 million in tax cuts and takes swipes at Washington

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RICHMOND — Gov. Glenn Youngkin pledged Friday to give Virginians nearly $400 million in additional tax relief, with the potential 2024 presidential nominee pitting his state’s strong fiscal position against what he described like Washington’s failure to budget responsibly and control inflation.

In an address to the House Money Committees, Youngkin (R) reported that the state ended its fiscal year on June 30 with a cash surplus of $3.2 billion – something he attributed to the overtaxation imposed by his Democratic predecessors and the efficiencies he brought to the state. government.

While some of that money was planned and already earmarked in the current budget — for uses ranging from a freeway widening project to a rainy-day fund deposit — Youngkin said he plans to set aside $397 million for unspecified tax cuts.

This would be on top of the $4 billion in tax cuts included in the two-year budget that took effect July 1.

“It’s not our money. It belongs to the hard-working taxpayers of Virginia,” Youngkin said in a 25-minute speech in which he frequently hit out at national leaders for “recklessly” managing deficits and stoking “skyrocketing inflation.”

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Youngkin said he intends to earmark the $397 million for a “taxpayer relief” fund when he proposes adjustments to the current budget in December. The General Assembly will resume its project during the session which will begin in January.

Lawmakers from both parties who gathered for the governor’s remarks shared his upbeat assessment of state finances, with Senate Finance and Appropriations Committee Chairwoman Janet D. Howell (D-Fairfax) calling financial report “the best I’ve heard in 30 years”. to the legislator.

But she said it was “premature” to promise tax cuts nearly six months before the General Assembly began tinkering with the biennial budget approved earlier this year.

“We are in such shaky waters,” she told reporters. “Hopefully we can do some tax relief, but that’s not necessarily in the bag and I wouldn’t want people to be hopeful.”

In remarks to reporters after his speech, Youngkin stood by his recent criticism of the Justice Department and the FBI for its search of former President Donald Trump’s home, where federal agents seized sets of classified documents.

Youngkin had noted in his speech that the state budget increased law enforcement spending by $400 million, saying, “Demeaning the police is not a way to go. In Virginia, we support our law enforcement officers.

A reporter asked Youngkin if this support extended to the FBI and the Justice Department, given his tweet following the raid which read: “Selective and politically motivated actions have no place in our democracy.”

Youngkin responded that he thinks Attorney General Merrick Garland has taken “a very inconsistent approach to his work,” suggesting he gave protesters a pass outside the homes of Supreme Court justices.

Youngkin dodged a question about one of his representatives on the University of Virginia Board of Visitors, Bert Ellis. The Cavalier Daily reported this week that as a student at U-Va. in the 1970s, Ellis helped bring William B. Shockley, a scientist who argued that blacks were genetically inferior to whites, to campus for a debate.

Youngkin said he had not seen the report, but seemed to suggest it was unfair to judge the 1970s controversy by today’s standards. He noted that the reporting on Ellis was done by “the same newspaper that wants to remove Thomas Jefferson in all respects from the University of Virginia.”

“I think we have to overcome that,” he said. “I think the reality is that we had founding fathers in this nation who were flawed.”

Ellis did not immediately respond to requests for comment.

In his address to lawmakers, Youngkin kept his jabs for Washington and painted a rosy picture of bipartisan relations in the state Capitol, despite early clashes with Democrats.

“I’m confident that when we put politics aside and forget who gets the credit, we’ll do it together again,” he said.

At least a few legislators from both parties rolled their eyes at Youngkin’s credentials in Washington, viewing them as further evidence that the governor who assumed his first elective office just seven months ago is considering a run for president.

A former private equity executive who invested $20 million of his personal fortune in last year’s race, Youngkin went from political unknown to an oft-mentioned contender in 2024 after winning seemingly blue Virginia.

He has been publicly coy about his intentions, but has met with Republican megadonors and made out-of-state political appearances.

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“I don’t know why he feels the need to blame Washington, DC for giving a report on how well the state’s economy is performing,” Sen. Adam Ebbin (D-Alexandria) said after the speech. “We have Washington to thank for helping weather the storm of the pandemic and part of the reason our state is in such good financial shape is because of the [pandemic] assistance from the federal government.

Youngkin said the $3.2 billion surplus was the result of $2 billion in “unplanned” revenue and $1.2 billion in unspent appropriations.

The state has known for months that revenue would exceed cautious forecasts made in the depths of the coronavirus pandemic. Youngkin noted that the state budget already relies on much of that money.

Youngkin told reporters he wasn’t sure what kinds of taxes he planned to cut. He also clarified that he would not seek to implement the $397 million in tax relief in the current budget cycle, saying, “Some of this tax reduction will take place over time.”

“That $400 million is a down payment,” he said.

Senate Minority Leader Thomas K. Norment (R-James City) said he would support setting aside the money in a tax relief fund, but talked about the money almost like a expansion of the state’s rainy day fund, noting that the legislature would have “some control” over how it was used.

“I’ve been here long enough to get through this cycle where we think things are going well and then we hit 2018 or, you know, 2008 or 2009,” he said, referring to previous downturns. “When we hit that downturn, all of a sudden those revenues will drop for whatever reason, it will be a big comfort that we have those resources.”

Of the. Barry Knight (R-Virginia Beach), chairman of the House Appropriations Committee, agreed with the goal — and the idea that lawmakers could shift gears if needed.

“It’s a wonderful place to park $400 million,” he said. “It kind of sets the tone for what we might look at in the future.”

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