Taxes in Virginia: Features and Advantages

Main Taxes in Virginia

Income Tax

Virginia applies a progressive personal income tax, with rates ranging from 2% to 5.75%.

Sales Tax

The base sales tax rate is 4.3%, but local surtaxes can raise it to 7% in some areas.

We provide services for obtaining a Sales Tax Certificate, preparing and filing Sales and Use Tax Returns, and advising business owners on registration, calculation, and reporting.

Property Tax

The average property tax rate in Virginia is 0.72% of housing value, which is moderate.

Business Taxes

Virginia levies a flat corporate income tax rate of 6% on net income. This applies only to C corporations.

The state requires all businesses to file an Annual Report each year, due by the end of the registration month.

Business Personal Property Tax

Furniture, computers, and vehicles are taxable. Rates and bases are set at the city or county level, often applying to small and medium-sized businesses.

Excise Taxes

Virginia levies excise taxes on alcohol, tobacco, and fuel.

Advantages of Virginia’s Tax System

• Transparency and predictability: moderate personal and corporate tax rates.
• No Franchise Tax or Business Tax.
• Low property tax rates — making homeownership more affordable.

Taxes in Virginia Compared to Other States

• Moderate personal (up to 5.75%) and corporate (6%) tax rates. However, personal income tax applies from relatively low income levels.
• No Franchise Tax or Business Tax, unlike Tennessee.
• Additional personal and business property taxes at the local level.
• Relatively low Sales Tax and Property Tax compared to other states.