West Virginia Gov. Jim Justice proposed a 50 percent cut in the state’s personal income taxes over three years while setting aside $700 million in reserve.
The plan, announced during his state of the state address last week, would be the largest tax cut in West Virginia history if enacted.
The plan calls for a 30 percent reduction in June 2023 and another 10 percent reduction in the following two years.
The National Federation of Independent Business (NFIB) hailed the proposal.
“Our members hope the legislature approves Governor Justice’s plan to slash West Virginia’s personal income tax rate by 50 percent over three years. The vast majority of small businesses in the state are organized as pass-through entities, meaning their owners pay taxes at the individual rather than the corporate rate,” NFIB State Director Gil White said. “It’s been a rough few years for small businesses in West Virginia, beginning with the pandemic and continuing with supply chain and labor issues, a spike in fuel prices, and soaring inflation that has driven up the cost of everything from raw materials to customer receipts.”
White pointed out that West Virginia ended the last fiscal year with a budget surplus of $1.3 billion.
“We believe the state can afford to reduce the individual tax rate without having to make up the difference by raising taxes and fees someplace else,” White said. “It’s easy to forget, but 98.8 percent of all businesses in the state are small businesses. By easing the financial pressure on these Main Street businesses, the legislature can clear a path for them to fully recover from the recent economic setbacks and continue to grow and create jobs.”