Personal Taxes

Justice, lawmakers weigh choices for revenue tax waiver Information, Sports activities, Jobs

Governor Jim Justice and lawmakers discuss how to move forward with an income tax reduction plan. (Photo provided)

CHARLESTON – Despite presenting an updated plan to cut income tax, Governor Jim Justice and lawmakers closed a summit on Monday with little hope of compromise with the House of Representatives or Senate before the end of the session on Saturday.

The judiciary held a summit Monday afternoon with the majority and minority leaders of the House of Representatives and the Senate at the Charleston Cultural Center to resolve disagreements between the judiciary’s personal income tax reduction plan and the two plans that both chambers pushed forward over the past few weeks had to bridge.

“Money is the people’s money” Justice said. “You are not our money and I am trying to put money back in people’s hands and I am trying to do something that is really beneficial and I know you are all trying to do the same. Let’s just keep working. “

House Bill 3300 is the current incarnation of an income tax exit plan. The draft law is in third reading today and will be passed with the right to amend.

As long as the bill remains in its current form, the House of Representatives will likely not accept the changes the Senate made to the bill, so a conference committee will have to come to a compromise. And both bodies never implemented the governor’s personal income tax plan, House Bill 2027 and Senate Bill 600.

The judiciary submitted an amended plan to the legislature on Monday “Justice 4 All.” The new plan includes tax cuts of $ 998.2 million.

Instead of cutting personal income tax rates by 60 percent, the new plan would cut tax rates by 50 percent. The previous version did not lower the taxes on personal income tax rates for small businesses, transit businesses, sole proprietorship, or investment income. The Justice 4 All plan would lower these rates by 33 percent. It also maintains the tax break for individuals and families earning less than $ 35,000 per year.

Many of Justice’s tax increases to offset the loss of revenue from the income tax cut remain in place, including the consumer sales and use tax increase from 6 percent to 7.9 percent, despite the fact that lottery tickets have been removed from the tax. The sales tax exemptions for professional services will continue to be removed. There is an excise duty on luxury goods and most tobacco taxes. It includes a lower tax on e-cigarette and vape products and eliminates previous tax increases on beer, wine and spirits.

In order to counter complaints from the coal and natural gas industry, the “Justice 4 All” plan also provides for a retrofitting of the graduated severance payment tax proposed by Justice. The updated sales, excise, and severance tax increases would bring in revenue of $ 812.6 million, clearing a $ 177.6 million gap from estimated growth, state wage cuts from retirement and attrition, and budget cuts of $ 25 million would be closed.

“I have given you a path here that is so gentle and helps every single person.” Justice said. “I beg you: talk to me, work with me and somehow let’s not miss this opportunity.”

Justice 4 All plans would have to be presented as amendments by a Senator when the Senate invites to debate HB 3300, otherwise it has no hope of being included in the new bill.

The Senate version of HB 3300 would cut income tax rates by more than 50 percent for all but investment income. The plan would cut income tax revenues by $ 1.09 billion.

The Senate plan would increase consumer sales and excise taxes from 6 percent to 8.5 percent, remove sales tax exemptions for professional services, and reduce food tax to 2.5 percent. tax-prepared food at 8.5 percent; a 4.3 percent tax on short-term accommodation; an 8.5 percent tax on contingent liabilities; and create a new lottery scratch game. The revenue from this tax increase would bring in approximately $ 890 million.

With the Senate plan, a SAFER fund (Stabilization and Future Economic Reform) is created. For every $ 100 million raised by the fund, the transfer would lower income tax rates by 12.5 percent in the following fiscal year. The proceeds for the SAFER fund would come from increases in various tobacco and e-cigarette taxes and bring in more than $ 73 million for the fund.

The judiciary criticized the Senate version of HB 3300 for placing more of a burden on working families by removing its tax rebate and reintroducing the food tax. Stephen Baldwin, Senate Minority Chairman, D-Greenbrier, asked if removing these items would break the bill for justice.

“This is part of the plan that our caucus really likes because we really care about who are among us and how that would affect them if they moved forward.” Said Baldwin. ”

The version of HB 3300 passed by Parliament last Monday would expire income tax by $ 150 million annually for the first full year until the tax is removed with no new taxes or increases to existing taxes. The House version includes an Income Tax Reduction Fund, which siphons off tax revenue from specific revenue streams and existing revenue streams to accelerate tax cuts while encouraging lower government spending. It is estimated that the house plan will expire completely between 11 and 17 years.

Doug Skaff, chairman of the minority House of Representatives, D-Kanawha, said he theoretically supported an exit from income tax but was concerned that this was not the right time.

“We’re here on day 55 … the timing is all I question.” Said Skaff. “The people coming out of a pandemic want security and reliability. They want to get their feet back on the ground. They want a business climate they can believe in. I doubt the urgency we have to do it today. “

Both House Speaker Roger Hanshaw, R-Clay, and Senate President Craig Blair, R-Berkeley, praised the judiciary for starting the conversation on income tax reform, but the comments at the close of the Summit seemed to close the chapter for this session.

“It is part of an overall strategy” Said Hanshaw. “I think everyone at this table is engaged today … but this (personal income tax reform) has to be part of our strategy to get people to move to West Virginia … I think there is a way between these three plans to achieve this. ”

“I’m not too worried about the wait” Said Blair. “Dragging this out forever doesn’t get the job done, but are we ready today? No, but maybe tomorrow. The sooner the better.”

Steven Adams can be reached at

Latest news and more in your inbox

Related Articles