After tax cuts, regulation rollbacks and other growth oriented policies, the Virginia economic and fiscal position is “extraordinary,” Governor Glenn Youngkin reported to the Joint Money Committees of the legislature.
Youngkin, along with Secretary of Finance Stephen Cummings, delivered a report showing boosts in both government revenue and the private sector growth over the last fiscal year. General fund revenues exceeded the official revised forecast by $572 million and the initial “common ground” budget by $2.7 billion.
Since assuming office four years ago, Youngkin reported that his administration has tripled the so-called “rainy day fund” from $1.5 billion to $4.7 billion in reserves. The state also has $1.7 billion in deployable cash on hand.
The increase in revenue comes even after $7 billion in tax cuts over the past three years and includes a $200 income tax rebate that taxpayers will receive in September and October. Last year, legislative democrats proposed a $1.3 billion tax increase despite soaring revenues.
Economists often cite that tax cuts create economic growth and thus result in higher government revenues. Youngkin and Lt. Governor Winsome Earle-Sears have claimed that President Trump’s One Big Beautiful Bill will have a similar growth impact on the country that their tax cuts have had on Virginia.
The Thomas Jefferson Institute for Public Policy outlined the economic boom including $125 billion in new investments and 265,000 new jobs created, citing Virginia’s cutting of regulation and lowering of taxes as key to Virginia’s growth.
“Governor Glenn Youngkin delivered a clear message: Virginia’s economy is stronger than ever because of pro-growth, free-market policy choices,” TJIPP said in a statement. “His speech is a masterclass in good governance and sound economic policy. We must not stray from the course he has set.”
Among the tax reform of the past four years is a higher standard deduction for the income tax, two increases in the Earned Income Tax Credit, and an elimination of state sales taxes on groceries.
Youngkin’s address warned of the dire economic consequences of the Virginia Clean Economy Act. Even Democrat leadership is balking at the law’s $5.5 billion in consumer compliance costs and are considering changing the law.
The Governor also challenged the claim that 40,000 Virginians will lose Medicaid because of Federal budget cuts. (RELATED: $609M Shock: Virginians Pay Price for ‘Clean’ Energy Push)
“Changes to Medicaid are not taking coverage away from anyone, and I want to say that again, not a single Virginian is losing access to Medicaid or getting kicked off the program,” Youngkin told reporters after his presentation.
Youngkin also reported that despite federal job cuts eliminating more than 11,000 jobs, the state had over 250,000 open and available jobs because of economic growth.
“We’ve witnessed opportunity grow all across the Commonwealth as we have successfully competed,” Youngkin said. “I am confident that if we continue working together on shared priorities, we continue to work together to deliver policies that we know work, we continue to work together to put Virginians first, then this great Commonwealth’s future will continue to be bright and Virginia will continue to lead the nation.”
(RELATED: Study Links Immigration Crisis to Rising Rent Costs)