Tax reform bill could have cost counties millions

Raleigh County

BECKLEY, WV (WVNS) — The controversial tax reform bill did not pass the state senate, and local commissioners are breathing a sigh of relief. The bill would have eliminated the business and inventory tax, lowered personal property taxes, and increased the sales tax.

Raleigh County cCmmissioners said the bill could have negatively impacted the county, leaving an estimated $100 million revenue deficit, statewide. County administrator, Jeff Miller, said Raleigh County alone would lose $4.2 million direct to county services, which is 20 percent of the annual budget. This does not include potential lost revenue to the Board of Education.

He said to help the citizens, the state should focus on eliminating the consumer personal property tax and introduce a guaranteed plan, through constitutional amendments to make the counties whole.

Read the full statement below:

“SB837 and SJR9 was introduced in the WV Senate this week. SRJ9 was a constitutional ratification related to ad valorem personal property taxes that would eliminate business and inventory tax for companies and would also lower and eventually eliminate tangible personal property taxes related to automobiles and other personal property for consumers. Ultimately, SJR9 failed to obtain 2/3 of Senate votes to pass on Tuesday, SB837 did pass by simple majority on Monday, however, SB837 needed the passage of SJR9 to advance to the House. While the Raleigh County Commission supports any tax break proposed to the citizens of West Virginia, especially Raleigh County, there is more buried within these 2 pieces of legislation that would have a negative impact on Raleigh County almost immediately. The eliminated tax revenue would be somewhat offset by increasing the WV Sales Tax to 6.5% and by increasing taxes on tobacco and vaping significantly, however, it would still leave an estimated $100,000,000 revenue deficit statewide. The introduced legislation proposed making counties whole on that lost revenue, but most importantly, it did not provide a permanent nor guaranteed source of revenue to fund counties and municipalities in whole. Currently, the county collects the personal property taxes and is controlled by local government, in this, the introduction of sales tax and tobacco tax would be collected by the State and then reallocated back to the counties. With so many essential and vital services provided by the Counties, such as but not limited to, Law Enforcement, Prosecuting Attorney’s office, Fire services and Parks and Recreation, the County cannot simply stand behind any legislation that takes money from us and gives it to the State in hopes we would be made whole. The proposed plan would be rolled out over a 6 year period with tangible personal property taxes decreasing each year until eliminated, however, the sales tax would go into effect immediately. Therefore, in Year 1 citizens would still be paying personal property taxes and also an increase in sales tax. The State has a projected budget deficit of over $600,000,000 over 6 years, therefore, the counties do not feel comfortable with the thought of the State collecting local tax money with just a promise and no guarantee it would not be used to offset their own budget deficit. Raleigh County alone would stand to lose annually $4.2M direct to county services, which represents 20% of our annual budget, this does not include potential lost revenue to the Board of Education. I am sure we will continue to see variations of this bill over the next few years. If the State really wants to help the citizens, they should focus squarely on eliminating the consumer personal property tax and introduce a guaranteed plan, through constitutional amendments to make the counties whole.”

Jeff Miller
Raleigh County administrator

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