W.Va. Senate releases tax plan, proposes 50% reduction in business and inventory tax
Plan also would cut income taxes by 15%, rebate personal property taxes and more
Photo courtesy of WV Legislative Photography Trending
CHARLESTON - The West Virginia Senate will cut personal income taxes by 15%, eliminate the “marriage penalty” for tax filers, rebate personal property taxes on vehicles, increase the homestead property tax rebate for disabled veterans and reduce the equipment and inventory tax paid by businesses by 50% in a plan released Wednesday.
The bill will return about $600 million to taxpayers, Senate leaders said in announcing the measure. It will be introduced later Wednesday.
Specifically, the legislation will call for the following tax changes:
-- A personal income tax reduction, starting with a 15 percent decrease in personal income tax.
-- Elimination of the "marriage penalty" when filing taxes in West Virginia.
-- A rebate for the payment of taxes on vehicles.
-- A homestead real property tax rebate for 90- to 100-percent service-disabled military veterans.
-- A 50 percent rebate for the payment of equipment and inventory taxes paid by West Virginia small businesses.
Senate President Craig Blair, R-Berkeley, said the Senate's plan is a result of several months of analysis of the state's financial picture. He said the plan returns money to citizens to provide necessary tax relief without jeopardizing West Virginia's financial future.
West Virginia currently is sitting on a $2 billion surplus and is one of only two states with a personal income tax to not provide any tax relief to residents.
"We studied the numbers, and at the end of the day, we knew the State had only about $600 million to give back to the citizens in the form of tax relief," Blair said. "Our plan provides relief for low-income families, senior citizens, disabled veterans, and small business owners, and it eliminates the penalty married couples incur when they file their tax returns jointly in West Virginia. Our plan provides relief for virtually everybody."
"About 98 percent of businesses in West Virginia are small, family-owned businesses, and this 50 percent rebate will directly benefit those families," Senate Majority Leader Tom Takubo, R-Kanawha, said of the reduction in the business and inventory tax. "The Governor has been a strong proponent of giving people and small business owners their hard-earned money back, and we applaud him for giving us the opportunity to put every idea on the table and come up with a path forward that benefits the most West Virginians."
Blair said the Senate’s plan will get more money back into West Virginians’ pockets.
"Lower-income families and retirees are often left behind with personal income tax cuts, so it was important for us to include the Governor's bill to rebate the tax on vehicles as a way for them to benefit from this plan, too," he said. "I believe we've put together a bill that pulls together the ideas of the Governor, House of Delegates, and the Senate, and we are looking forward to getting it across the finish line."
Gov. Jim Justice has proposed and the House has passed, 95-2, a plan to cut the personal income tax in half over the next three years. Under that plan, West Virginia’s top rate would go from 6.5% to 3.25%, lower than all its border states except Pennsylvania. The Senate’s plan will drop the top tax rate to about 5.5%, higher than many of the border states.