Virginia State Tax Guide

State tax rates and rules for income, sales, property, fuel, cigarette, and other taxes that impact Virginia residents.

Bottom Line

Middle-Class Families: Mixed Tax Picture (Go to the Kiplinger Tax Map for Middle-Class Families)

Retirees: Tax-Friendly (Go to the Kiplinger Tax Map for Retirees)

All-in-all, Virginia offers a fair to good environment when it comes to taxes. Income taxes in the Old Dominion can be a bit higher than the national average for some residents.

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However, sales tax rates in the state are lower than in most other states. Virginia's average combined state and local rate of 5.75% is the 11th-lowest in the nation. Clothing and groceries (reduced rate) are taxable, though. The statewide median property tax rate is below average, too.

Virginia is also sending one-time tax rebate payments of up to $250 ($500 for joint filers) to qualified taxpayers. The state is sending payments after it receives a 2021 Virginia income tax return.

Virginia Income Taxes

Virginia Income Tax Range

Low: 2% (on up to $3,000 of taxable income)

High: 5.75% (on taxable income over $17,000)

Virginia Taxation of Social Security Benefits

Social Security benefits are not taxed by the state.

Virginia Tax Breaks for Other Retirement Income

Income from a retirement plan may be deductible if contributions to the plan were previously taxed in another state.

In addition, taxpayers age 65 and older can claim a deduction of up to $12,000. For taxpayers born after January 1, 1939, the deduction is completely phased-out for single taxpayers with a modified adjusted gross income of $62,000 or more and married taxpayers with a modified AGI of $87,000 or more.

Beginning in 2022, veterans 55 years of age and older can deduct up to $10,000 of military retirement income and other military benefits. The deduction is increased to $20,000 for 2023, $30,000 for 2024, and $40,000 for 2025 and thereafter. Congressional Medal of Honor recipients can exclude all income from a military retirement plan.

Railroad Retirement benefits are also exempt.

Virginia Sales Tax

5.3% state levy, which includes a 1% tax allocated to local governments. Some local governments also impose additional taxes of up to 1.7%, making the average combined state and local rate 5.75%, according to the Tax Foundation.

  • Groceries: Taxable (1.5% state rate, plus 1% local tax)
  • Clothing: Taxable
  • Motor Vehicles: Exempt from ordinary sales tax, but taxable under special 4.15% excise tax.
  • Prescription Drugs: Exempt

NOTE: The state sales tax on groceries is repealed starting in 2023. Local taxes on groceries will still apply.

Virginia Real Property Taxes

In Virginia, the median property tax rate is $815 per $100,000 of assessed home value.

Virginia Property Tax Breaks for Retirees

A county, city, or town may enact a program for senior citizens and disabled persons allowing for exemption, deferral or a combination of both for property taxes on homes owned and occupied as the sole dwelling of a person 65 or older. Annual family income is generally limited to $50,000 to qualify for a program, but it may be higher in certain Northern Virginia communities. In addition to annual family income limits, net worth limits may apply. There are no adjustments at the state level.

Virginia Motor Fuel Taxes

Gasoline: 34.4¢ per gallon (36.2¢ per gallon effective July 1, 2022).

Diesel: 35.3¢ per gallon (37.2¢ per gallon effective July 1, 2022).

Virginia Sin Taxes

Cigarettes: $0.60 per pack (additional local taxes may also apply)

Moist snuff: $0.36 per ounce

Heated tobacco products: $0.0225 per stick

Other tobacco products: 20% of the manufacturer's price, except "roll-your-own tobacco," which is 10%

Vapor products: $0.066 per ml

Beer: $0.26 per gallon

Wine: $1.51 per gallon

Liquor: $19.89 per gallon (the liquor tax is an estimate by the Distilled Spirits Council of the United States and published by the Tax Foundation)

Marijuana: Effective July 1, 2023, 21% excise tax on retail sales, plus state and local sales tax; 3% local tax may also apply

Virginia Estate and Inheritance Taxes

No estate or inheritance tax.