Govenor Jim Justice by DSC_1308 is licensed under CC BY-SA 2.0

The call for effective and permanent tax relief has never been louder as Americans continue to feel the pinch in their budgets with rising inflation and gas prices. West Virginia Governor Jim Justice just announced a 10% personal income tax cut and that he will be calling a special legislative session to pass this proposal. This proposal comes in light of the state’s record-breaking single-year tax surplus of $1.308 billion. 

Personal income tax was the state’s biggest revenue source for the 2022 fiscal year at $461.5 million, a 16.6% increase from the fiscal year 2021. With this substantial increase in revenue from personal income tax, the massive surplus, and the country’s current economic situation, Justice correctly felt that that the time was right to provide meaningful income tax relief to residents. “As a result of our incredible economic growth… We want to provide West Virginians with a tax cut for permanent relief and not a temporary stimulus,” Justice said during a special announcement earlier this month from the State Capitol Building. Early estimates predict that the proposal will put $250 million back into the pockets of West Virginians. Justice’s proposal falls in line with 11 other states who have passed bills this past year to either reduce or phase out their state’s personal income taxes in face of the current economic environment. He hopes that his proposal will open the door for the eventual phaseout of the state’s personal income tax and looks to join the nine other states who currently have no state personal income tax.

Justice’s proposal has gained support from the party in both chambers. House Finance Chairman Eric Householder (R) has recently come out and voiced his support for the governor’s proposal. In an interview with MetroNews’s Talkline, he said that an income tax cut would be a win for the people of West Virginia. Earlier this year, Householder sponsored a similar bill, HB 4007, which would have also decreased the state’s personal income tax rate by 10% across all tax brackets. While HB 4007 did not pass the Senate, Justice chalked that up to not knowing what the state’s tax surplus would look like for the fiscal year at the time. Now with the full data, he believes that the time is right to move forward with such a bill. 

Now more than ever it is time for reasonable and responsible tax cuts to be enacted to ease the burden of the American people, and Governor Justice’s 10% reduction on the state’s income tax does just that. While House and Senate Republicans have had their differences on how to provide decreases on income tax in the past, Justice’s proposal is a fantastic idea that both chambers can get behind. Americans for Tax Reform hopes that the House, Senate, and Governor can work together to help the people of West Virginia and make this proposal a reality.