Gov. Jim Justice is hoping for an answer soon from the state Senate about his proposal to cut personal income taxes.
“I’m going to be more blunt. I’m going to tell you that, basically, what’s happening is stall, procrastination. That’s what’s going on,” Justice said during an appearance in Martinsburg on Tuesday.
“And at the end of the day, if we just keep messing around with this we’re going to get to a point in time and we’re worried about protecting the state, so let’s don’t do anything. I can’t imagine we’re just going to walk off and leave. It’s not right.”
Justice has been on the road to promote his proposal of an initial 30% personal income tax cut, then 10% the following year and 10% the third year.
A fiscal note assessing the bill concludes it would decrease General Revenue Fund collections by about $161.8 million in fiscal 2023, a little more than $1 billion million in fiscal 2024, $1.2 billion in fiscal 2025, and almost $1.5 billion in fiscal 2026.
Right now, West Virginia is running a budget surplus of hundreds of millions of dollars. But that’s based on several factors, including high energy prices that have produced high-performing severance tax returns and artificially low state revenue projections that have enforced relatively “flat” budgets for several years in a row.
The House of Delegates overwhelmingly passed a bill reflecting the tax cut proposal a couple of weeks ago. The Senate has been more deliberative.
Many senators are skeptical that the governor’s plan to cut taxes balances with the state’s proposed spending. Senators say they support a significant tax cut for West Virginians, but it’s not yet clear what specific plan senators might agree on.
House Majority Leader Eric Householder said he remains optimistic about talks with the Senate.
“I wish it was an easy answer. We are meeting once a week; we’re having breakfast over at the mansion,” Householder said, referring to the governor’s staff, House leaders and Senate leaders.
“And we’re trying to find a common path forward. The Senate has asked the House to prioritize spending, which I would agree. If we’re going to embark on personal income tax cuts we should prioritize what our spending limits are.”
All in all, Householder said, “It’s my hope that we could reach some common agreement.” He said, “I’m willing to compromise. I’m willing to talk about it. I’m willing to do whatever agreement we can reach.”
Justice agreed with all of that, but said, “the problem is, we’re in an auction with ourselves. They say ‘We’re going to come out with a plan. This is the ultimate ‘Where is the beef.’ Where is the plan?”
