July 20, 2022
Mountaineer News
CHARLESTON, WV - Legislation that would reduce the West Virginia income tax by 10% will be considered by lawmakers during a special session, which Gov. Jim Justice announced will begin Monday.
On Wednesday afternoon, the governor announced the session would begin on Monday at noon. The income tax legislation will be the only bill considered during the special session, which was scheduled to line up with the interim meetings so lawmakers would not need to make a separate trip to Charleston.
The governor’s proposal would not be a flat tax cut. Although every tax bracket would see lower rates, low-income West Virginians will get the largest breaks.
For those making $10,000 or less, the bill would reduce the income tax from 3% to 2%. Those making between $10,000 and $25,000 would see their tax rate go down from 4% to 3.7%. A person earning between $25,000 and $40,000 would have their rate decrease from 4.5% to 4.2%. Anyone making between $40,000 and $60,000 will see a reduction from 6% to 5.5%. Finally, those who earn more than $60,000 will have their taxes cut from 6.5% to 5.98%.
According to the governor’s office, those who make about $10,000 will pay about 33% less in taxes, those earning about $30,000 will pay about 14% less, those making about $50,000 will pay about 11% less and those making between $60,000 and $80,000will pay about 10% less. Those who make between $90,000 and $200,000 will pay about 9% less.
Justice said in a statement that this legislation is the first step in fully eliminating the income tax.
“Once we get the ball rolling, we can keep coming back and chipping away at our personal income tax until it’s completely eliminated,” the governor said. “When you look at states like Florida, Texas, and Tennessee, they have no personal income tax and their state economies are growing like crazy. There is a direct correlation. People are moving to no-income-tax states because they can keep more of their hard-earned paycheck, which spurs ever greater economic activity. It’s a cycle of goodness producing goodness. That’s what I want in West Virginia, and I hope that the Legislature will agree with me and pass this bill.”
The plan would be retroactively enforced, which means it would apply to income beginning on Jan. 1, 2022. It would put more than a quarter of a million dollars back into the hands of West Virginia taxpayers, according to the governor.
Republican leadership has expressed its support for lowering and eventually eliminating the income tax, but previous plans have fallen flat over disagreements about the best way to go about reducing and eliminating it. House Finance Chairman Eric Householder, R-Berkeley, has already stated that he would prefer a flat tax cut, which would affect all income brackets equally. He introduced a similar plan earlier this year, which could not make it through the Senate.
House and Senate Democratic leadership has spoken against the plan.
“The Governor announced this plan without discussion with or input from legislators - and we are the ones who have been hearing from people across the state on what would help them the most,” House Minority Leader Doug Skaff, D-Kanawha, said in a statement.
“The limited special session call also precludes us from discussing other avenues for meaningful tax relief for West Virginians. His lack of communication aside, we look forward to reviewing this plan to see how we can provide much-needed relief to the citizens of our state,” stated Skaff.
Both chambers have Republican supermajorities.
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