Starting July 1, 2020, a number of new state and local tax laws go into effect in Virginia. Some of the changes include:
Cigarette and Tobacco Products Tax Increase; Liquid Nicotine Subject to Tobacco Products Tax
- The tax rate doubles for cigarettes and other tobacco products currently subject to the tax. The tax on a pack of cigarettes increases from 30 cents to 60 cents per pack.
- The new tax rate for liquid nicotine products is 6.6 cents per milliliter on sales or purchases on or after July 1.
See Tobacco Products Tax and Cigarette Tax for more information.
Halifax County Local Sales Tax Increase
Beginning July 1, a new one percent local sales tax raises the sales tax rate in Halifax County to 6.3%. This includes the 4.3% state tax, the one percent local option tax, and the one percent Halifax additional tax.
The increased sales and use tax increase does not apply to food purchased for human consumption, such as groceries, or essential personal hygiene products since both are taxed at a reduced 2.5% rate.
See Tax Bulletin 20-6 for additional information.
Retail Sales and Use Tax Exemption for Gun Safes
As of July 1, gun safes with a selling price of $1,500 or less per item are exempt from the retail sales and use tax.
This exemption includes a gun safe or vault that is:
- Commercially available;
- Secured with a digital or dial combination locking mechanism or biometric locking mechanism; and
- Designed for the storage of a firearm or for ammunition.
Glass-faced cabinets are not eligible for this exemption.
Skill Games Tax
Starting July 1, new legislation requires electronic gaming distributors to pay a monthly tax of $1,200 for each skill game that distributor provided for play in the previous month.
The majority of the funds collected – 84% -- are designated for the COVID-19 Relief Fund. The tax expires on July 1, 2021. See Skill Games Tax for more information.
The litter tax rate is doubling for businesses. You must pay $20 per business location, and an additional $30 for each location that manufactures, sells, or distributes groceries, soft drinks, or beer. Additionally, the penalty for late payment of the litter tax is increasing by $100.
Since the litter tax is due annually, these increases become effective on May 1, 2021. See Litter Tax for more information.
For a complete list of 2020 state and local tax legislation, view the 2020 Legislative Summary.