CHARLESTON — A big tax cut for many West Virginia workers is a step closer to reality, but there is still one big hurdle to pass. With just 12 days left in this legislative session, there is some urgency to get it done.
The fate of a bill to cut income taxes now lies in the House of Delegates after a surprise development in the State Senate on Saturday.
The original tax cut proposed by Governor Justice and passed by the House was to cut taxes by 30% this year. The Senate proposed a cut of just 15%. But over the weekend, the Senate voted to up its tax cut to 21.25%, and it passed.
If passed by the House, the tax cuts would be retroactive to January 1. till, there is sharp division on who it will benefit the most.
“We think it’s a pretty good start, a good bill. It roughly will put $650 million back in the pockets of West Virginians. You know, over half a billion dollars and that’s a substantial thing to move our state forward,” said Jason Huffman, of Americans for Prosperity, West Virginia chapter.
“Well I think, you know, the income tax cuts overwhelmingly benefit the wealthy. About $2 out of every $3 of the tax cut will go to the top 20% of households. We are worried about the impact it could have on the budget,” said Kelly Allen, Executive Director of the West Virginia Center on Budget and Policy.
Some delegates are also sharply divided.
“I’m very happy. It’s a start. It’s a good start, and we’re going to be able to take it through the full House and review if this is something the House wants to proceed with. But right now it’s a good start,” said Del. Eric Householder, (R) Berkeley – Majority Leader.
“We need to make it meaningful to the people who need it the most and deserve it the most. You know the Democratic proposal was a 100% income tax cut for families making $80,000 a year and less,” said Del. Mike Pushkin, (D) Kanawha – WV Dem. Party Chairman.
The Senate also passed a separate bill to improve the starting pay of teachers and state troopers, with a $2,300 base salary increase. But the PEIA health insurance rates for public employees are going up, and critics worry that will sharply cut into the pay hike.
The House will now consider both of those bills.
The Senate income tax bill also includes giving all vehicle owners a rebate of their personal property tax on cars and trucks. The House will have to consider it.