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Subcommittee advances bill to create state tax whistleblower rewards, refers SB224 to Appropriations 8–0
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Summary
Subcommittee 1 advanced SB224, sponsored by Senator Serravel, to create a state whistleblower reward program for recovered state taxes. Committee and tax staff agreed in concept on confidentiality language; the bill was reported with a substitute and referred to Appropriations by an 8–0 vote.
Senator Serravel’s SB224, a bill to create a state-level whistleblower reward program for recovered state taxes, was reported with a substitute and sent to the Appropriations Committee after a Subcommittee 1 vote of 8–0.
The bill would authorize the Department of Taxation to pay rewards to individuals whose information leads to recovery of unpaid state taxes, paralleling an existing federal program that awards informants whose tips lead to recovery. "I hate it when people don't pay their taxes," the bill’s patron said, describing examples such as taxpayers falsely claiming out-of-state domicile or schemes to avoid gas taxes.
Committee members asked about program thresholds and confidentiality. A committee member noted the bill’s working thresholds—an underpaying individual taxpayer gross income threshold of $100,000 and a business threshold of $500,000—and asked whether those levels might exclude smaller but significant cases. Senator Serravel said he pulled the numbers from memory and is open to adjustments, and he compared the proposal’s scale to federal IRS thresholds mentioned in the discussion.
Tax department staff and committee counsel discussed confidentiality provisions designed to allow the department to confirm whether taxes are owed and to disclose recovery amounts to an informant. A Department of Taxation representative said the confidentiality language was added "because without that language, relieving the Department of Confidentiality, we wouldn't be able to even confirm that there was any unpaid tax or underpayment," and that the bill would require an informant to sign a confidentiality agreement to prevent broader disclosure of taxpayer information.
Committee counsel offered to draft clarifying language to address concerns about protecting informant identity and records, including potential statutory safeguards beyond existing Code section 58.1-3. With that understanding, a member moved to report the bill with a substitute and refer it to Appropriations. Talia Gardner moved to report with substitute; the motion was seconded. The clerk opened the roll, and the measure was reported by a vote of 8–0.
The subcommittee took no public testimony; no in-person or online speakers registered. The referral sends SB224 to Appropriations for further consideration and fiscal review.
