West Virginia Lawmakers Pass Legislation for 2% Personal Income Tax Cuts

A wave of positivity is across West Virginia as a bold and progressive move of cutting personal income tax rates by 2% has officially passed by state lawmakers. Despite concerns over using money from the state’s three health agencies to pay for it. The bill will head to the governor’s desk.

There is already a 4% personal income tax cut going into effect in January 2025 because the state hit an economic trigger. The additional 2% cut would also go into effect in January. Some lawmakers said it would equate to around $200 a year for the average West Virginia family.

“Even a little bit is meaningful. A gallon of milk helps families,” said Del. Larry Kump, R-Berkeley. “Anything we do to reduce the tax burden on our families is a good thing.”

The Democrats were worried about this reduction in the income tax and mentioned that these cuts are critical for state programs, but Gov. Justice disagreed and said the state could afford the tax cuts.

“When you give that $100 million back to the people of West Virginia, they’re going to spend it here. And the multiplier effect on that hundred million will turn into ten times, will turn into a billion,” Gov. Justice said last week.

“So, I really think it would be up to the new governor and the new legislature to make a policy decision as grave as this,” State Sen. Mike Woelfel (D-Cabell – Minority Leader) said last week.

This tax cut will cost $46 million to implement, and more than half of it will be paid for through around $27 million in what the Justice administration said were available funds from the Department of Human Services, Health, and Health Facilities. Lawmakers created the departments last year after they split up the former state Department of Health and Human Resources.

“That was one of the reasons that we did the split up of DHHR was to reduce overhead costs and they’ve started to realize their savings,” House Finance Chairman Vernon Criss, R-Wood, told House members. “There are more cost savings there than we had intended to see when we did that. That’s a good thing.”

A 2% cut in personal income tax rates would take effect on the first day of the new year and return approximately $46 million to taxpayers. Del. Vernon Criss, the House Finance Committee chair, said he would have preferred a 5% tax cut, but an agreement couldn't be made with the Senate to support that.

This is a great initiative by the State for its people as a West Virginia resident. This tax is an opportunity that helps in managing finances a little better. With more dedication, people can use that money to invest and give back to the State in different ways.?

“We have taken incremental steps to make sure that we are making sure that West Virginia is the best place to live, work, and raise a family,” Steele said.?

We will keep you updated with further developments related to this legislation. Share your thoughts in comments about this new legislation and how this tax cut will impact you.?

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