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Virginia Democrats Vote to Eliminate Coal Tax Credits That Were Created to Help Southwest Virginia

 

 

February 3, 2021 - The Virginia House passed a bill Monday that would phase out two coal tax credits that a state investigation recently found generate economic losses for the state.

On a 54-45 vote, the chamber approved the measure from Del. Sally Hudson. The bill still must pass the Senate before it can go to the governor. A similar measure in the Senate hasn't yet received a vote.

The incentives are designed to encourage coal production and coal use and aid the struggling economy of southwest Virginia. A report last year from the state's legislative watchdog agency found that they have created a net loss for the state.

The report estimated that between fiscal years 2010 and 2018, the Virginia economy lost 35 jobs, $21 million in gross domestic product, and $5 million in personal income because of the credits. During that same period, coal mining companies and electricity generators saved $291.5 million in income taxes, according to the report, which recommended that they be repealed.