State Tax Credits

Commercial and Industrial Sales & Use Tax Exemption

Virginia offers sales and use tax exemptions for eligible equipment used directly in manufacturing and research and development operations.

Green Job Creation Tax Credit

For taxable years beginning before January 1, 2025, the Green Job Creation Tax Credit allows a credit against the Virginia individual or corporate income tax for each new green job that pays an annual salary of at least $50,000 that is created within the Commonwealth by the taxpayer.

International Trade Facility Tax Credit

An income tax credit is allowed for either capital investment in an international trade facility (ITF) or increasing jobs related to an international trade facility. To qualify, an ITF must show at least a 5% increase in shipments through Virginia Port Authority (VPA) ports in Virginia.

Major Business Facility Job Tax Credit

Effective for taxable years beginning on or after January 1, 2016, Virginia allows an individual and corporate income tax credit for incurring more than $5 million of Virginia qualified research and development expenses during a taxable year.

Port Volume Increase Tax Credit

Virginia’s Port Volume Increase Tax Credit benefits manufacturing, distribution, agriculture, and mineral and gas companies that utilize Virginia’s port facilities 

Recyclable Materials Processing Equipment Tax Credit

An income tax credit is available to manufacturers for the purchase of certified machinery and equipment used for processing recyclable materials in taxable years beginning before January 1, 2025. 

Refundable R&D Expenses Tax Credit

Effective for taxable years beginning on or after January 1, 2011, but before January 1, 2025, Virginia allows a refundable individual and corporate income tax credit for incurring Virginia qualified research and development expenses during a taxable year.