Voters could approve local taxes for school building projects

A county or city could ask voters to approve a local sales tax of up to 1% for school projects. The money could pay only for public school construction, additions, major repairs, related infrastructure, or school site purchases in the county or city imposing the tax. Voters must approve the tax in a referendum started by the local governing body. The tax would not apply to food for people or essential personal hygiene products. If approved and adopted, the tax could start on the first day of a month at least 120 days after the ordinance is adopted. It must have an end date.

A county or city that imposes the school sales tax could also impose a matching local use tax. It would apply to certain taxable items bought outside Virginia for use or storage in the locality and certain rentals from out-of-state businesses. It would not apply where the local sales tax applies. The county or city must first impose the school sales tax. The use tax would not apply to food for people or essential personal hygiene products. The tax would end when related bonds or loans are repaid, or by the end date set by the locality, no more than 20 years after its resolution.

Some counties and cities with an existing school sales or use tax would need another voter referendum to extend it. The rule covers counties and cities that had imposed a school sales or use tax by June 30, 2026. This applies if the county or city imposed the school sales or use tax by June 30, 2026, and wants to extend it beyond the end date approved in the original referendum. The additional referendum must take place before the tax's current expiration date.