CHARLESTON, WV (WOWK) – West Virginia lawmakers will now consider a bill by Governor Jim Justice that will eventually abolish state income tax. If approved, the bill would cut the state’s income tax by 60% over the next year and phase the tax entirely over the next three years.
The consumer sales tax would rise from the current 6% to 7.9%. Republicans believe this will attract new people and businesses to the mountain state.
“Well you know when a business is coming and they bring in a lot of workers. And these workers bring their families with them. And then they buy houses and they buy cars. And they buy in our communities, ”said Delegate John Mandt, (R) Cabell.
WV sales tax would surpass US states under the income tax reduction plan
“It’s one of those things we can do to reverse the population decline. We are seeing many people in our state leaving West Virginia in search of wealth, ”said Eric Householder, Delegate of the Finance Chairman, (R) Berkeley.
The bill would raise the tax on a pack of cigarettes to $ 2.25. Taxes on sugary drinks would increase by an unspecified amount. There would also be taxes on services like lawyers and advertising. Democrats particularly hate the VAT hike.
“He’s suggesting a consumer sales tax of 7 to 9 percent, which will be very difficult in the border counties. And in the cities where you add a percent, that’s nearly 9 percent of sales tax, ”Del said. Larry Rowe, (D) Kanawha.
“I’m afraid it will hit the lower earners disproportionately, more than the upper earner,” said Del. Brent Boggs, (D) Braxton – Minority Finance Chair.
Severance taxes on coal and natural gas are staggered. Taxes will be low when production is low, but the tax rate will rise when sales are booming.
Although Republicans have majorities in both the House and Senate, the governor’s tax burden is not a closed deal. The next stages for the bill are the finance committees of the House and Senate.
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