CHARLESTON, WV (WOWK) — A plan that would cut the income tax of West Virginians quickly moved through the West Virginia House of Delegates by a vote of 95-2.
During the debate about the plan that reduces personal income taxes by 50% over the next three years, Democrats proposed an amendment that was rejected.
The amendment would have cut income taxes for all West Virginians making $80,000 or less come July 1, 2023. Democrats say that would have benefited 72% of West Virginians. They believe the bill moving through the chambers, backed by West Virginia Governor Jim Justice benefits higher earners.
The plan that now will go back to the senate will also establish what is being called Personal Income Tax Reserve Fund which will be comparable to the state’s Rainy Day Fund.
The idea is that if there was ever an economic downturn and the state had a deficit, income taxes would not be boosted and the fund would be used to balance the shortfall.
According to a press release from Governor Justice, “this insurance policy protects against any shortfalls as we go forward.”
The income tax phase-out begins with a 30% reduction retroactive to the start of this year, followed by two years of a 10% reduction.
“This is the quickest way to return tax dollars to our people and puts West Virginia on a pathway to eventually eliminate the personal income tax entirely, which will drive phenomenal growth to our state for generations to come. With the unbelievable economic growth our state has achieved, now is the time to provide this major tax break for our people,” Justice said in a press release.