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Loggers granted tax exemption in Lunenburg

Lunenburg County is one of a few surrounding counties to approve a request from the Virginia Loggers Association (VLA) to exempt logging businesses from certain taxes, potentially costing the county approximately $70,000 in lost revenue.

During the approval of the county’s fiscal year 2021-22 budget, the Board of Supervisors (BOS) agreed to the request.

Tracy Gee

According to the newly approved budget that was unanimously adopted Thursday, June 10, the budget includes a 33% reduction in the machinery and tools tax (M&T) for the tax exemption for logging equipment.

“This matter was discussed at both a finance committee and BOS meeting after the Logging Association made their presentation,” County Administrator Tracy Gee said. “The finance committee recommended a reduction of M&T for logging equipment.”

As of press time, Gee did not give details as to why the BOS decided to grant the exemption.

At the April 8 BOS meeting, Executive Director Ron Jenkins with the VLA addressed the BOS requesting the exemption.

“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.

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.

“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 their 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.

In neighboring Charlotte County, Jenkins also made the same request; however, the BOS denied his proposal stating it would be too much of a tax revenue loss. Charlotte County does not currently exempt farm machinery from its machinery and tools tax.

In addition to Lunenburg, 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 are Alleghany, Bath, Bedford, Brunswick, Campbell, Goochland, Highland, Pittsylvania, Rockbridge and Wythe counties.