Cost of Doing Business in the Lynchburg Region

The Lynchburg Region boasts a low cost of doing business. Forbes ranked the Lynchburg MSA 50th on the its Cost of Doing Business List.

Virginia’s corporate income tax has not been raised since 1972. At 6 percent, our rate is one of the lowest in the country. In Virginia, items taxed at the state level are not taxed at the local level, with the exception of the sales and use tax levied by both state and local governments. The combined state and local sales tax is either 5.3 or 6 percent depending upon the locality. Virginia also differs from most states in that its counties and cities are separate taxing entities. A company pays either county or city taxes depending upon its location. If the company is located within the corporate limits of a town, it is subject to town and county levies.

Corporate Income Tax

  • Tax rate of 6%
  • Tax credits for job creation and investment in economically stressed areas

Sales and Use Tax

  • The total tax is 5.3 percent (4.3 percent state tax and 1 percent 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.

Real Estate Tax

  • In the Lynchburg Region real estate tax ranges from .52 per $100 assessed value to $1.11 assessed value.

Machine & Tool Tax

  • The Region boasts some of the nation’s lowest tax rates. For example, in Amherst County the machinery and tools tax is 25% of $2.00 per $100 of original cost.

Business Personal Property

  • Most localities in the Lynchburg Region levy a business personal property tax.

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