Gov. Jim Justice signed a bill into law to cut personal income taxes by another 2%, celebrating the overall tax-cutting trend.
“Another 2 percent,” Justice said at an administration briefing today, continuing by referring to his name for average West Virginians. “Another 2 percent for the goodness of Toby and Edith through every single day, and we should always remember they’re why we’re here.”
This tax cut is on top of a 21.25% income tax cut that just went into effect, plus another 4% tax cut that will occur automatically because the state hit an economic trigger.
“It shows that we are continuing to head in the direction of being able to turn back money in to the people of West Virginia,” said House Finance Chairman Vernon Criss, R-Wood, speaking on MetroNews’ “Talkline.”
“It shows the trending that we are wanting to continue, and I think that’s the important part.”
Justice at the beginning of July had called for an additional 5% personal income tax cut. During a special special that concluded earlier this month, lawmakers settled on the 2% instead.
Some lawmakers, prior to the special session, had expressed caution about the governor’s 5% tax cut proposal because other tax cuts are still going into effect and because there are additional spending commitments also still going into effect — like the continued rollout of the Third Grade Success Act and estimated additional costs for more Hope Scholarship enrollment.
The additional 5% personal income tax cut was estimated to equate to about $110 million that would not be available to pay for the expenses of state government.
The 2% amounts to about $46 million, state officials said.
Justice, now a Republican candidate for U.S. Senate, has said West Virginia should demonstrate that it’s on track to eventually eliminate the state income tax.
“Absolutely, West Virginia needs to stay on the path of getting rid of your personal income tax. If you do that, there’ll be opportunity. There’ll be jobs. There’ll be so much goodness it’s off the chart. In order to do that, we’ve got to stay on the path,” Justice said today.
During a debate this week, the two major party candidates for to succeed Justice as governor were asked about their preferred approach to tax cuts.
Both the Republican nominee, Attorney General Patrick Morrisey, and the Democratic nominee, Huntington Mayor Steve Williams, said they want to cut taxes if conditions are right. But they differed somewhat on how to determine if that’s the case.
Williams said conditions for a tax cut would only be correct “if you have a plan.”
“So yes, if I have an opportunity to be able to go in and eliminate the income tax, fine, do that — but I don’t see a plan in place. It feels very much to me like this is saying ‘We want to do this and by God we’re going to find a way to do it regardless.’ We need to have a plan and a strategy place,” Williams said during the debate.
Morrisey said his administration would have a plan.
“On day one of a Morrisey administration, we’re actually going to lay down every single tax that West Virginia currently has, lay it out so the public can see — and you’re going to compare it with every single state that we touch. And then the first order is to actually try to take steps to start to defeat the other states economically and have superior tax policy,” Morrisey said.
“So the immediate goal is going to be having a state income tax that is actually superior, lower than all the states that we touch. That’s actually paramount to begin to see the migration of people coming in.”
Morrisey then suggested that another term of former President Donald Trump would produce a more robust energy outlook to benefit West Virginia and “that will provide the additional resources to cut the income tax even further.
“There is a plan on taxation — also on regulation, on licensing, on workforce rules — to do a comparison beginning on day one with all the states that we touch, so we can have the freer, economically-superior policies.”