Coming off the greatest year of revenue collections in state history, Gov. Justice announced his proposal to permanently cut the personal income tax by an aggregate of 10%.
Under the Governor’s proposal, the aggregate 10% tax cut will be retroactive back to January 1, 2022, putting $254 million back in the pockets of West Virginians.
The proposed total tax reduction of $254 million is the maximum recommended reduction that can be safely made while remaining in compliance with American Rescue Plan Act (ARPA) guidelines.
“I’ve been the biggest proponent of completely eliminating our state personal income tax. It will drive job growth, population growth, and prosperity in West Virginia. But the most important thing to do is get started right away,” Gov. Justice said. “In the past year, gas prices have gotten out of control and inflation is through the roof. West Virginians need help right now.
“Once we get the ball rolling, we can keep coming back and chipping away at our personal income tax until it’s completely eliminated,” Gov. Justice continued. “When you look at states like Florida, Texas, and Tennessee, they have no personal income tax and their state economies are growing like crazy. There is a direct correlation. People are moving to no-income-tax states because they can keep more of their hard-earned paycheck, which spurs ever greater economic activity. It’s a cycle of goodness producing goodness. That’s what I want in West Virginia, and I hope that the Legislature will agree with me and pass this bill.”
The Governor’s proposal is simple enough to be contained in a two-page bill and is a true cut – reducing the Personal Income Tax without raising any other taxes in the process.
Under the Governor’s proposal, the State personal income tax brackets will remain the same, while the tax rates – which haven’t changed since 1987 – will drop for West Virginians at every income level.