Finance Subcommittee #1

Monday, January 26, 2026·1h 6m·▶ Watch / Listen

Finance Subcommittee #1 advanced two bills — an innocent spouse tax relief measure and a military retiree pension CPI adjustment — while tabling three others on fiscal grounds, including proposals to expand military retirement tax exemptions to uniformed service members and equalize tax deductions for Civil Service Retirement System retirees. A wage garnishment consumer protection bill passed unanimously, and a federal tax conformity bill was deferred pending a missing fiscal impact statement.

Key Actions

·HB 716 – Income Tax; Innocent Spouse Tax ReliefNo Vote

+ 1 more action

Controversies

HB 1351 – Whether CSRS recipients should receive the same retirement tax deduction as FERS recipients

Delegate Leftwich argued that CSRS retirees on fixed incomes face inflation and affordability issues and that other retirees already receive relief from Virginia taxes on their retirement income, making parity fair. Delegate Watts countered that it would be double dipping because CSRS employees received higher retirement payments precisely because they never paid into Social Security, and granting them an additional deduction as if they had received Social Security would be inequitable.

+ 4 more controversies

Notable Quotes

“I do have a direct conflict of interest and I shouldn't have put it in in the first place.”
Delegate Watts — Delegate Watts, the Uber Chair and patron of HB 959, made this statement when moving to strike the bill from the docket before any substantive discussion.

+ 4 more quotes

Votes

Motion to strike HB 959 from the docketPassed

Motion for HB 977 to go by for the dayPassed

Motion to report HB 716No Vote

Motion to gently lay HB 47 on the tablePassed

Motion to adopt substitute for HB 137Passed

Motion to report HB 137 with substitute and refer to Appropriations (first attempt)No Vote

Motion to report HB 137 with substitute and refer to Appropriations (final)Passed

Motion to gently lay HB 1351 on the tablePassed

Motion to lay HB 1080 on the tablePassed

Motion to adopt substitute for HB 488Passed

Motion to report HB 488 with substitutePassed

Motion to adjournPassed

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TranscriptPreview

Good afternoon, everyone, and welcome to the very first meeting of the 2026 subcommittee number one of Finance. As the Uber chair explained at our full committee meeting, this particular subcommittee this session will be taking up matters of state tax policy, whereas subcommittee number two will be the lead on local tax policy. So with that, just thank everyone for being here and making it here if they had to dig out from ice, as I did this morning. But good to see all of you. We're going to take care of a couple housekeeping matters first, and for that, I will turn to our Uber chair, Delegate Watts, both for HB959 and 977. And actually, before I do that, I will open the roll so we can take attendance. All right. And a quorum is present. So, Uber Chair Watts, thank you very much, Mr. Chairman. First, on administrative, I would like to strike House Bill 959. It is my bill. I do have a direct conflict of interest and I shouldn't have put it in in the first place. And I put this in writing, so move. All right. That is a recorded vote, so it's been…

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