CHARLESTON – Governor Jim Justice presented his state income tax repeal plan to West Virginia lawmakers Thursday, which will cut state income taxes for West Virginia residents by 60 percent in the first year and sales tax for consumers by nearly 2 percent and more Increased severance taxes on oil, natural gas and coal as well as taxes on tobacco and alcohol products are to be increased.
Justice introduced the idea at its State of the State address and has held several virtual town halls answering questions from West Virginia residents. He believes the repeal of state income tax would help boost the state’s economy by bringing new businesses and residents into the state.
“We have all the building blocks in our state” Governor Justice said in the press release the filing of the bill. “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. “
Justice’s original plan was to cut state income taxes by 50 percent in the first year, but the bill increases that number to 60 percent. The cuts would relate to income earned through wages and salaries, as well as pensions, annuities, IRAs, social security and unemployment. Those cuts would add up to about $ 1.035 billion.
To compensate for this, the state consumer sales tax would increase from 6 percent to 7.9 percent. Justice said it would put an additional $ 475 million in the treasury. There would also be a tiered luxury tax on certain big ticket items. Items between $ 5,000 and $ 10,000 would be taxed at 3 percent, with the tax percentage going down on more expensive items. A purchase of more than $ 1 million would be taxed at 1 percent.
The judiciary also introduced tiered severance tax rates on coal, oil and natural gas, as well as increased taxes on cigarettes and other tobacco products, alcohol and soft drinks.
Latest news and more in your inbox