Taxes & Incentives
An Effective Environment for Business
Grow your business with competitive taxes and a range of incentive programs in the Lynchburg region. From the state corporate income tax that has held steady at 6% since 1972 to the low cost of living that keeps wages reasonable, employers here find added capacity and increased productivity.
Virginia is currently ranked No. 8 nationally for business incentives, boosted by key discretionary incentives like the Commonwealth Development Opportunity Fund — a deal-closing fund — and several grants for capital investment and job creation. The Lynchburg Regional Business Alliance collaborates with businesses to ensure capital investments and relocations are practical, compelling, and cost-effective.
A Stable Tax Environment for Businesses
Unchanged since 1972, Virginia’s corporate income tax rate remains at 6% — lower than the national median. The combined state and local sales tax is either 5.3% or 6%, depending on the locality.
Sales and Use Tax
- The total tax is 5.3% (4.3% state tax and 1% local tax).
- A seller is subject to a sales tax on gross receipts derived from retail sales or leases of taxable tangible personal property.
- Manufacturers do not pay tax on purchases used for production; distributors do not pay tax on items purchased for resale.
Other Taxes
- In the Lynchburg region, real estate tax ranges from $0.52 per $100 assessed value to $1.11 per $100 assessed value.
- The region boasts some of the nation’s lowest machine & tool tax rates. For example, in Amherst County, the machinery and tools tax is 25% of $2.00 per $100 of the original cost.
- Most localities in the Lynchburg region levy a business personal property tax.
Additionally, a number of tax credits are available in the state, including:
- Worker Training Tax Credit
- Research and Development Expenses Tax Credits
- Green Job Tax Credit
- Port Volume Tax Credit
- International Trade Facility Tax Credit
- Barge and Rail Usage Tax Credit
- New Company Incentive Program
The Lynchburg Region Goes to Bat for Companies
The state of Virginia’s business incentive program was ranked No. 8 in the nation by Area Development for 2023, led by an attractive list of grants and tax credits that continue to grow businesses within the Lynchburg region. Key discretionary incentives include the Commonwealth’s Development Opportunity Fund, which acts as a deal-closing fund, the Virginia Investment Partnership Grant for facility modernization, the Major Eligible Employer Grant for significant employment increases, and grants targeting maritime commerce and agricultural businesses.
Several local and state incentives are also available including:
Local Incentives
- Technology Zones
- Enterprise Zones
- Opportunity Zones
- Foreign Trade Zones
- New Market Tax Credits
- Assistance with utility fees and charges
- Delivery of infrastructure to sites & buildings
- Write-down of costs of sites & buildings
- Capital Investment Programs
- Redevelopment Programs
- Real Estate Rehab & Renovation Tax Credits
- James River Arts & Cultural District Program
- Tourism Zone
State Incentives
- Commonwealth Opportunity Fund
- Virginia Investment Partnership Act
- The Virginia Development Incentive Grant
- Clean Energy Manufacturing Incentive Grant
- Virginia Jobs Investment Programs
- Corporate Income Tax Credits
- Virginia Port Authority
- Sales and Use Tax Credits
- Property Tax Exemptions
- Economic Development Access Program
- Rail Industrial Access Program
- Transportation Partnership Opportunity Fund
- Virginia Small Business Financing Authority
- Enterprise Zones
- Technology Zone
- Foreign Trade Zones
- Defense Production Zones
- Tobacco Region Revitalization Commission (only applicable in the counties of Appomattox, Bedford, and Campbell)
England Stove Works in Amherst
For nearly 50 years, the Englander stove brand has made its home in Monroe, Virginia, recently expanding and modernizing its 100,000-square-foot facility.
Tools & Resources
Why LYH Region?
Imagine a place where opportunity meets community, and you’ll find yourself at the Edge of the Blue Ridge.
Success Stories
Manufacturers, professional services, and nuclear technology companies scale to greatness in the welcoming and talent-ready region of Lynchburg.
Trade Assistance
The Alliance can connect your company to the right people and resources for a successful international trade operation.
Leading Stories in Lynchburg
Get the latest on recent business expansions, community initiatives, and developments affecting the business community in the Lynchburg region.
Source4 to expand operations in Bedford County investing $4.5 million and creating 30 jobs
The Bedford County Office of Economic Development, in partnership with the Economic Development Authority (EDA), is pleased to announce that Source4, an integrated business and marketing solutions provider, will invest more than $4.5 million and add 30 new jobs in Bedford County over the next five years. “We have enjoyed our experience in Bedford County […]
Huge Win for CVTC Master Redevelopment Plan
On June 8, the Lynchburg Regional Business Alliance held a press conference at the former Central Virginia Training Center, featuring Senator Steve Newman, to announce the General Assembly has included $25 million in the state budget to fully defease all outstanding bonds associated with CVTC. Additional speakers at the event included Megan Lucas, CEO and […]
Lynchburg EDA selected to receive $500K from EPA for brownfield redevelopment
Lynchburg’s Economic Development Authority again has been selected to receive $500,000 in assessment grants from the Environmental Protection Agency to continue to assist businesses and property owners to identify, assess and begin redevelopment of brownfields. According to a news release, funding dedicated to the assessment of sites potentially affected by hazardous substances and petroleum will […]
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