Mobile machinery and equipment; tax credit for purchase.
If enacted, the bill will modify the Code of Virginia by adding a new section that provides this tax credit for taxable years starting from January 1, 2025, until January 1, 2030. The total credit allowed per taxable year would not exceed 40% of the taxpayer's Virginia income tax liabilities, fostering an incentive for road contractors to invest in eco-friendly machinery. The legislation could significantly impact state revenues, as it caps the credits at $3 million per fiscal year, potentially leading to increased scrutiny over resource allocation.
House Bill 1524 introduces a tax credit for the purchase of mobile machinery and equipment utilized by road contractors for the purpose of processing recyclable asphalt materials on pavements and roadways. This credit allows taxpayers to receive a 20% deduction on the purchase price of eligible machinery and equipment, enhancing the economic feasibility of recycling asphalt materials. The legislation is aimed at promoting the use of sustainable practices within the infrastructure sector.
There may be discussions around the effectiveness and implementation of this bill, given that it relies on the Department of Environmental Quality to certify the machinery for recycling purposes. Developers and contractors would need to navigate the certification process to ensure they qualify for the credit, raising questions about administrative efficiency. Moreover, the bill's stipulations may provoke debates regarding the balance between facilitating commercial profitability through tax breaks and enforcing stringent environmental regulations to achieve actual reclamation and recycling actions.