Can anyone tell me if Turbotax Virginia state takes into account new tax rules extablished on 01 July 2022. Specifically, the military retire exclusion of $10000?

Yes, but you need to enter this manually as you prepare your VA state return.

1. Log into Turbo Tax
2. Go to your state return and begin the interview.
3. You will reach a page that says Here is the income that Virginia handles differently
4. Here you go to Military>Military Benefits Subtraction
5. Next page you will enter your Military Benefits Received. This will give you your maximum Military Benefit up to $10,000. This is what the screen looks like. 

Thank you DaveF1006.  Perfect reply that resolved my question. 

It was not intuitive with a title "Military Benefits Subtraction" as military retirees would be searching for "U.S. Military Retired Pay" exclusion or something similar, but it's taken from the Virginia State Tax form which is derived from the IRS  26 USC 134.  So I learned something.

In retrospect, I should have researched the Virginia 2022 Form 760 Resident Individual Income Tax Instructions.