Personal Taxes

Governor Justice Takes Earnings Tax Abolition Laws; 60% low cost for the primary 12 months

CHARLESTON, W.Va. – After setting up multiple virtual town halls over the past few weeks to answer questions from those affected, Governor Jim Justice announced today that he has submitted a bill to West Virginia lawmakers to repeal mountain state income tax.

Governor Justice described today’s bill as a golden opportunity to change the tax structure of West Virginia. Raising wages, increasing house values, engaging more businesses, more people, and improving the lives of all Western Virgins.
In support of his actions, Governor Justice shared data collected between 1950 and 2016 that doubled the total population of the United States. Across the board, 49 out of 50 states gained weight, with the exception of West Virginia.

Between 2010 and 2020, West Virginia’s population decreased by 3.8% in what is known as the largest rate of decline in the country. During Justice’s first term as governor, from 2016 to 2020, West Virginia lost 2.6% of its population, despite population maintenance measures such as right to work and applicable wage laws, ways to prosperity, tourism investment, and more.

“We may never have such an opportunity again,” said Governor Justice. “Because of the way we handled the COVID-19 pandemic – how we saved lives, had the best vaccination program in the country, and kept our economy moving – West Virginia is currently in the spotlight of the world. This is the time to take our opportunity. ‘
“We all have the building blocks in our state,” continued Governor Justice. “We have an economy that is really on the starting grid, some of the greatest people you will ever find, who are smart, kind, faith-based, hardworking people, along with four of the best seasons on earth with more natural beauty than you could imagine. But now we have to take a big step to outdo ourselves. If people look at any other population map 70 years from now, West Virginia will be right up there with the top states in the country.
“The final piece of this puzzle is eliminating our personal income tax. So I propose a plan to make this dream come true, starting with a 60% reduction in state income tax for the first year. “

West Virginia will be the first and only state in the Mid Atlantic or Northeast to eliminate state income taxes.

The plan aims to fuel employment and population growth in West Virginia by attracting people and businesses looking to set up shop in low-tax states.

According to the judiciary, every West Virginian will benefit from the plan. All lower income brackets less than $ 35,000 per year will receive a tax rebate check under the plan.
To offset the cut in government operations tax dollars, the judiciary said the whole of West Virginia must “pull the rope”.

The tightening of the rope begins with the state consumer sales tax being changed from 6.0% to 7.9%, while a small luxury tax is added on a single item for certain high-quality luxury items that the judiciary says only the very rich normally buy.
According to the governor’s proposal, professional services such as legal and accounting services pay the same tax rate as craftsmen such as plumbers and electricians. The consumer sales tax base is expanded to include computer hardware / software, legal services, accounting services, other professional services, select advertising, electronic computing, and health and fitness memberships.

The governor believes that the new taxes will be balanced when people migrate to the mountain state. Taxes on soft drinks, tobacco products, beer, wine and spirits will also be changed.

The judicial bill also calls for the introduction of a tiering system for severance taxes for natural gas, oil and coal. “When times are good, these companies toss a little more, and when times are bad, the state raises and lowers the severance tax to protect their critical jobs. “

The governor’s plan has also been criticized across the state.

In its current structured form, West Virginia sales tax would increase to 7.9 percent, making it the highest state sales tax in the country and effectively making our combined state and local sales tax rate of 8.4 percent higher than any surrounding state. That tax shift would be a godsend for high-income West Virgins, while regressive sales taxes would shift to low- and middle-income families, the same families hardest hit by the pandemic, said the WV Center on Budget & Policy.

Worse, the proposed allowances total $ 185 million less than the tax cuts, which means that when combined with the governor’s flat-rate budget – which already does not take inflation into account – we are considering budget cuts equal to 5 percent of our total base budget pull. This amid a pandemic where public services are more important than ever.

“Governor Justice’s plan is as regressive as we feared. While it brings huge tax cuts to the wealthiest West Virginians, the tax shifts would fall most heavily on the vast majority of West Virginians who have low and middle incomes, ”said Kelly Allen, Executive Director of WVCBP. “The plan also cannot fully offset the lost revenue from cuts in income taxes, which means inevitable cuts in public services amid an ongoing pandemic. We urge the governor to highlight exactly what he wants to cut in order to balance the budget. “

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