CHARLESTON, WV (WOWK)—Governor Jim Justice has been talking about eliminating or reducing the personal income tax for weeks but has been light on details. During Wednesday’s State of the State, we got the details: a 50% immediate reduction and, ultimately, total elimination of the personal income tax, just like eight other states in the country.
“Well it seems to have helped them a great deal, in attracting new folks to their states. I know that’s what the Governor’s desire is, as well as the leadership in both houses,” said Assistant Majority Whip, Del. David Kelly.
Right now the income tax accounts for 40% of West Virginia’s revenue, and increasing the sales tax may hit those who can least afford a hike the hardest.
“I am afraid it’s going to shift to people – the middle and low-income earners, are going to really struggle, with this,” said Minority Finance Chair Del. Brent Boggs.
The income tax cut is offset by increases in tobacco taxes and sugary drink taxes and an overall increase in the sales tax by $.015. By comparison, Virginia and Ohio have the lowest sales taxes in the regions. Right now, West Virginia, Kentucky, Pennsylvania, and Maryland are tied at 6%. If the Mountain State goes to 7.5%, will that send shoppers in many border counties across state lines?
“So I think the impact is huge, Mark. And I think for our constituents to have to travel elsewhere, to keep just a little bit of extra money in their pockets is going to be huge on them,” said Del. Sean Hornbuckle.
Even some Republicans who want to cut income taxes worry the governor’s plan adds too many other taxes.
“I’m in favor of the overall concept, but we need to make sure we’re not taxing people to death,” said Del. Ben Queen.
The tax cuts are in the Finance Committees, and it could be weeks before we see votes.