Tax Reform

As Richmond continues to grow, we need innovative solutions to make the city affordable for all residents while fostering economic development. I’m proposing two key areas for tax reform to help residents and small businesses.

Tax Reform for Residents

Revenue generated by our tax base funds our schools, public amenities, and the delivery of city services. Historically, taxes are raised to fund new projects and initiatives to shoulder those costs. But it doesn’t mean you see a direct reinvestment for neighborhood improvements.

That’s why, in 2020, I worked with then-Senator Jennifer McClellan to pass legislation to allow Richmond to adopt a land value tax model that shifts our focus from taxing buildings to taxing land value itself.

This revenue model is a smarter, more equitable approach that ensures Richmond grows responsibly—without displacing residents or stifling development.

This will help lower the tax burden on homeowners (especially seniors and those on fixed incomes who struggle to keep up with rising taxes), encourage the development of unused properties like empty parking lots and shuttered storefronts, and create more housing options to reduce housing scarcity to mitigate rising rent prices. As Richmond’s next mayor, I will begin implementing the LVT system in my first budget.

How the Land Value Tax Works

Shifts the tax burden from buildings to land: Unlike traditional property taxes that tax both land and structures, the LVT focuses primarily on the value of the land. This means that homeowners won't be taxed more for improvements or additions to their homes and their annual tax bills remain steady.

Tax Reform for Small Businesses

Richmond’s businesses pay triple the tax rate than Chesterfield and Henrico. That hinders the city’s ability to compete in the region to attract and maintain business.

In my first budget as mayor, I will raise the Business, Professional, and Occupational License (BPOL) threshold to $1,000,000 and decrease the current BPOL tax rate ($0.58/$100) until it matches the regional rate of ($0.20/$100).

Benefits for Richmond

  • Lowers the tax burden on homeowners: By taxing land rather than the structures built on it, the Land Value Tax helps homeowners, particularly seniors on fixed incomes, who struggle to keep up with increasing property taxes. This reduces the risk of displacement, ensuring they can stay in their homes as neighborhoods grow and property values rise.

  • Turns blighted properties into housing: Property owners sitting on vacant or neglected land will be motivated to develop it, as holding onto idle land becomes more expensive under a Land Value Tax. This leads to the creation of new housing, commercial spaces, and mixed-use developments. By making it more expensive for investors to sit on valuable undeveloped land, we create a market incentive to develop substantially more housing, which will increase our housing supply and can lower skyrocketing rents.

  • Creates diverse housing options: By encouraging development, Richmond will see more diverse housing types—apartments, townhomes, single-family homes, and mixed-use developments—at a variety of price points, helping people from all walks of life find homes in our city.

  • Supports a vibrant local economy: When blighted properties are transformed into housing or commercial spaces, it not only provides more places to live and work but also generates additional revenue for the city, boosting services and infrastructure.

ANDREAS’S VISION FOR RICHMOND

Leading Richmond Forward

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