WV House passes 10% income tax cut despite unresolved

(The Center Square) – Legislation that would reduce West Virginia’s income tax by 10% passed the House of Delegates overwhelmingly, even though negotiations with the Senate are still not resolved.

House Bill 301, sponsored by Speaker Roger Hanshaw, R-Clay, passed the chamber with bipartisan support 78-7 with 15 members not voting. The bill would not be a flat tax cut, but rather a tiered tax cut based on income, which would amount to an overall tax cut of 10%.

Those who make $10,000 or less would see an income tax cut from 3% to 2%. Anyone who makes more than $10,000, but not more than $25,000 would see a cut from 4% to 3.7%. Earners who make more than $25,000, but not more than $40,000 would see a cut from 4.5% to 4.2%. Those who earn more than more than $40,000, but no more than $60,000 would see a cut from 6% to 5.5%. Finally, anyone who makes more than $60,000 would see a cut from 6.5% to 5.98%.

The legislation does not raise any other taxes or cut any programs. The plan is exactly what Gov. Jim Justice introduced at the start of the session.

Although House lawmakers were able to find common ground on the tax cut, some comments from leadership suggest that Senate Republicans are not on board with the legislation as it currently stands. However, a motion that would have postponed the legislation for one day was unsuccessful.

“I think it’s very clear that a 10% across-the-board personal income tax cut is not what the Senate wants to do and, therefore, I think we should delay action one day,” Del. Jason Barrett, R-Berkeley, said on the House floor. “If we pass this bill out of here today with 90 plus votes as I assume that it will receive, I think that sends a very clear message to the Senate that we’re done negotiating and I think it sends a very clear message downstairs that we think this is the only plan to reduce taxes in West Virginia.”

Most lawmakers disagreed. The motion was overwhelmingly rejected with only four yes votes.

“It’s time that this House act and try to give [income tax relief] because at this point in time, we can do so,” Del. Bill Anderson, R-Wood, said in response. “I believe the governor’s plan is sound, I believe it’s the right approach and it’s one that I support.”

Anderson argued voting on the bill does not end the negotiation. Rather, he said the Senate can amend the legislation and send it back to the House.

House lawmakers passed a similar bill earlier this year during the regular session, but it never received a vote in the Senate. The governor, along with House and Senate leadership, have all expressed their intent to eventually eliminate the income tax, but over the last two years, they have been unable to agree on the best way to do it.