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Va. Tax Increases Debut Without Fanfare

Many Skeptical That Higher Levies on Sales, Cigarettes Will Benefit Education

By Eric M. Weiss and Karin Brulliard
Washington Post Staff Writers
Thursday, September 2, 2004; Page B01

Few Virginia shoppers interviewed yesterday were aware of tax increases that went into effect yesterday, and even fewer believed that the money would go where the politicians promised it would go: to education.

The state's General Assembly approved a $1.3 billion tax increase this year that included a half-cent increase in the general sales tax, a large increase in cigarette taxes and a smorgasbord of other fees and charges. The changes went into effect yesterday.


Mary Guzzardo, 48, smokes a cigarette while waiting for a bus in Arlington. She said she is willing to pay the higher state tax on cigarettes. Others were less supportive of higher taxes. (Kevin Clark -- The Washington Post)

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"I picked today of all days to go shopping," said Tom Sparkman, 27, who found out about the higher sales tax after spending $100 on a boombox and batteries at Target in Alexandria.

Although most shoppers said the sales tax increase wasn't enough to get hot about by itself, many lumped it with a host of other increases in the cost of daily life, such as higher gasoline prices and property taxes.

Elizabeth McDonald, 35, who recently moved from Tyler, Tex., said the cost of living in the Washington region is hard enough on her wallet. "Given the fact that I just paid my car taxes for the year, this is not good news," she said. "But what are you going to do?"

Whether the state should raise taxes to solve its fiscal problems was the subject of much political hand-wringing and arm-twisting this year and sent the legislative session into overtime.

In the end, the sales tax was increased from 4.5 percent to 5 percent, and the cigarette tax was increased from 2.5 cents a pack to 20 cents this year and will rise to 30 cents in 2005.

The tax for recording a deed rose from 15 cents to 25 cents per $100 in value.

Taxes on some incomes and on groceries will be cut, some corporate tax breaks will end and the state will cap the amount it spends on car tax relief starting in 2006.

There were no news conferences scheduled yesterday by state leaders to herald the tax increases. But the package probably will become a centerpiece of next year's races for governor and the state legislature.

The debate has riven state Republicans, who control both chambers of the General Assembly. And some lawmakers are calling for additional revenue to help unclog the state's highways and bolster mass transit.

But for Debbie Cropper, the outcome is simple: Things will cost more. "It's hard. My husband has to work harder to get what we need," said Cropper, 32, of Triangle, who had four of her five children with her at Potomac Mills mall yesterday. "It's expensive when you've got to buy for five."

Others said Virginia taxes are still relatively low compared with other states. What they are waiting for is the services that the extra money will pay for.

Rob Lewandowski of South Riding said he didn't give the tax increase a thought when he purchased a DVD and tennis balls at a Super Target yesterday.


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