Loss of machinery and tools tax may cost thousands
Published 11:44 am Thursday, April 15, 2021
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The Virginia Loggers Association (VLA) is requesting Lunenburg County to exempt logging businesses from certain taxes, potentially costing the county approximately $70,000 in lost revenue.
Executive Director Ron Jenkins with the VLA addressed the Board of Supervisors during the Thursday, April 8, meeting requesting an exemption from the machinery and tools and personal property taxes on forest harvesting equipment.
“Our logging companies are the least able to continue making the tax payments and yet are key to the entire forest products industry,” Jenkins said. “Before landowners can reap any returns from their timber investments or mills can make any of the essential products for our homes, loggers must harvest and haul these raw materials for processing.”
Jenkins said despite higher finished lumber prices; loggers are not recipients of higher returns on the raw products.
“Weather and mill quotas continue to hurt our loggers’ production,” Jenkins said.
Jenkins spoke of the amount of money a logging business owner must spend to operate one’s business telling supervisors that one chipper could cost up to $1 million dollars.
“This industry depends upon people that are smaller businesses in general, and they’re family-owned businesses,” Jenkins said. “This really depends on if they are able to continue to pass that business down to their next generation.”
A new state law now authorizes localities to amend its tax ordinance to provide tax relief previously granted to farmers for their farm machinery to now include forestry equipment. According to Jenkins, most Virginia localities have amended their tax ordinance to exempt farm machinery.
“The Virginia Farm Bureau of 33,000 producer farmers agreed that agriculture and forest harvesting were similar enough and that forest harvesters should be allowed the same exemption on their equipment,” Jenkins said.
Currently, 10 counties in the commonwealth have amended their tax ordinance, adopting the new state law to exempt machinery and tools and personal property taxes on forest harvesting equipment.
These counties include Alleghany, Bath, Bedford, Brunswick, Campbell, Goochland, Highland, Pittsylvania, Rockbridge, and Wythe.