Tag: Joint Select Committee on Tax Reform

Lawmakers Struggle with Right Course of Action for Tax Reform

As part of a continuing effort exploring possible changes to the state tax code, members of the Joint Select

Committee on Tax Reform held a day-long public hearing at the capitol Tuesday. The hearing allowed West Virginia citizens to share their suggestions for ways to improve the state’s tax structure, and while at least a dozen citizens showed, few lawmakers filled the seats to listen. That, however, didn’t stop members of the public from openly sharing what they think are the right steps for West Virginia.

From eliminating certain taxes to increasing others – the Joint Select Committee on Tax Reform heard it all.

Many speakers at Tuesday’s public hearing brought up issues with the state’s severance tax, property tax, and income tax credit – giving their own ideas to either lessen the pull or to increase revenue.

Some mentioned the benefits of increasing the tax on tobacco, saying it would help to decrease the amount of West Virginia smokers while also bringing in more money at the same time.

Speakers asked lawmakers to remember the children who come from families making minimum wage and live paycheck to paycheck.

Senator Mike Hall, a Republican from Putnam County, shares the chairmanship with Delegate Eric Nelson, a Republican from Kanawha County.

Hall says the tax reform committees in both houses will have a lot to think about.

“We heard a wide array of comments,” Hall noted, “We heard about the income tax credit, which we were aware we would, but we also heard from the coal association, business community, saying there are certain taxes here that really hurt us, and though it will be difficult to deal with those quickly, because there are multi-millions of dollars of revenue, it’s important for us to hear that.”

Hall says the looming question this session will be how to adequately manage reforming the tax structure in a low budget year.

“Revenues are down, can we live with them, there’ll be a lot of pressure from people to raise this or raise that to cover costs, but, right now, so we’re in a mode of seeing where can we operate, the revenues are low, and so it’ll be very hard to talk about tax policy in this climate in the legislative session, but I think at the end of the day, when the committee’s done, we’ll have a few things to propose and some major principles to look at and say going forward as things would permit that we would like to see our tax code be changed in a manner that would be more beneficial to our economy.”

Tax reform is likely to be at the forefront of the 2016 session, and legislators know they face a contentious battle ahead.

Who's Giving Money to West Virginia's Tax Reform Committee?

When Republican lawmakers took control of the state Legislature for the first time in some 80 years in 2015, party leaders maintained their legislative priorities wouldn’t change. 

Over the past several years, the party has been pushing tort reform–something they accomplished during the 2015 legislative session–and initiatives to create a better business climate in West Virginia. Those changes are expected to come through the Joint Select Committee on Tax Reform.

A committee that did not exist a year ago, some of its members were also not in the Legislature or in their current chambers this time last year. More than 1,600 donors contributed more than $1 million during the 2014 election cycle to elect members of the committee, with the exception of two Senators who were elected in 2012.

Contributions from Businesses, PACs and Organizations

 

Of the non-individual donors, or businesses, political action committees and other organizations, that donated to committee members, the West Virginia Chamber of Commerce donated the most at $12,500. The Chamber was followed in donation totals by the West Virginia Bankers Association at $11,400, American Electric Power at $10,750, and the West Virginia Hospital Association at $10,600.

In West Virginia, non-individual and individual contributors are limited to making $1,000 donations per election. That means during one election cycle, which includes both a primary and general election, contributors can donate as much as $2,000 to a candidate’s campaign committee. However, candidates can contribute an unlimited amount of money to their own campaigns.


Who Raised the Most?

 

During the 2014 election cycle, newly elected Republican Sen. Ryan Ferns outraised any other member of the Joint Tax Reform Committee, receiving $341,746.40 in donations. According to data from the National Institute on Money in State Politics, Ferns donated $207,695 to his own campaign.

 

“There are pros and cons to contributing money to your own campaign versus accepting donations from donors. To me, the obvious advantage is there [are] less implications that you’re beholden to any special interest,” Ferns said Tuesday. “It’s hard for anybody to make an argument that I’m beholden to any special interest.”

 

“It’s unfortunate that campaigns are getting as expensive as they are, but I was outspent by my opponent.”

Credit Perry Bennet / West Virginia Legislative Photography
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West Virginia Legislative Photography
Sen. Ryan Ferns looks on during a September 15 meeting of the West Virginia Legislature’s Joint Select Committee on Tax Reform. Ferns contributed more that $207,000 to his own campaign, by far the most of any member on the committee.

Ferns’ opponent in the 2014 election, Democrat Rocky Fitzsimmons, raised $481,331. He donated $221,000 of his own money to his campaign.

Following Ferns with the highest number of total campaign contributions were:

  • Sen. Ed Gaunch (Kanawha County, R): $158,177.50
  • Sen. Roman Prezioso (Marion County, D): $112,339.60
  • Del. Eric Nelson (Kanawha County, R): $77,365.00
  • Sen. Robert Karnes (Upshur County, R): $74,265.40

Sens. Gaunch and Karnes both donated notable totals to their own campaigns. Gaunch contributed $42,445, Karnes $55,595. Sen. Prezioso’s totals are from the 2012 campaign cycle.

Contributions from Legislative Leaders

Both Senate President Bill Cole and House Speaker Tim Armstead are members of the Select Committee–yet both are non-voting members. Speaker Armstead did not contribute to any other Tax Reform Committee members’ campaign. Cole, however, donated to four members:

  • Del. John O’Neal (Raleigh County, R): $250
  • Sen. Ryan Ferns (Ohio County, R): $2,000
  • Sen. Ed Gaunch (Kanawha County, R: $2,000
  • Sen. Robert Karnes (Upshur County, R): $1,000

The committee will hold its next meeting on Oct. 5 at the Capitol. An agenda for that meeting has not yet been posted.
 

Below is another interactive data visualization exploring individual campaign contributions by legislator as well as contributor.

Tobacco Tax Likely on Table for 2016 Session

As lawmakers continue to discuss ways to reform the state’s tax code, Tuesday’s meeting of the Joint Select Committee on Tax Reform focused on one tax increase that may be palatable for members of the state Legislature, the tobacco tax.

West Virginia last increased its tobacco tax in 2003 to the current 55 cents per pack which, according to the national Tax Foundation, is the 8th lowest in the nation.

Tax Foundation Policy Analyst Jared Walczak told members of the committee while the state does have one of the highest smoking rates in the nation at 23 percent, an increase in the tax is not necessarily a sustainable source of revenue into the future.

“The first year is likely to be a watermark or close to it,” he told the committee.

Walczak said the state’s tobacco tax revenues show an increase in 2004, the year after the state’s most previous tax increase. Since, Walczak said revenues have leveled. 

“There’s a lot of people talking about the tobacco tax,” House Finance Chair Eric Nelson said Tuesday. “I think now is the time to look at many things and that’s one of them.”

Senate Minority Leader Jeff Kessler agreed. Kessler introduced a bill to increase the tax during the 2015 session and said he plans to propose another in 2016 with a dedicated source.

“I think we need to raise [the tax] and put some of that money into substance abuse programs in our local communities,” he said. “Every county needs a substance abuse treatment facility and centers and counselors to help these kids get off it.”

Get Rid of W.Va.'s Income Tax? Lawmakers Take on Tax Reform

A select group of West Virginia lawmakers began an arduous process Monday, combing through the state’s current tax code and finding ways to bring it “into the 21st Century,” as one delegate put it. 

The Joint Select Committee on Tax Reform was one of only four committees to meet during April interims, the first held under the new Republican leadership. 

House Finance Chair Eric Nelson, who is co-chairing the committee with his Senate counterpart Mike Hall, told the group of 10 Republicans and four Democrats “everything is on the table,” and for Hall, everything includes the state’s personal income tax.

“Some state have no income tax,” he said during Monday’s meeting, “and we know that people gravitate toward those states. It would be wonderful it we could figure out a way to do that.” 

Doing that, according to Ted Boettner, executive director of the West Virginia Center on Budget and Policy, would result in a $2 billion loss in revenue for West Virginia, or about 40 percent of the state’s total budget. 

“To do something like that, eventually getting rid of the personal income take, you’re talking about a major tax shift, most likely on low and moderate income people in this state who can least afford it,” he said.

Boettner said Monday he worries too much of the committee’s focus will be placed on reducing business taxes and less on working families. 

Both House Speaker Tim Armstead and Senate President Bill Cole addressed the committee before their organizational meeting Monday. Both expressed the importance of the work the committee will take on in the coming months they say will move the state forward.

Hall announced the Joint Select Committee on Tax Reform will meet twice in May to begin delving into their work. At those first meetings, lawmakers will hear from those who crafted previous tax reform studies under the Underwood and Manchin administrations.

Cole has said in the previous weeks he would like to see a special session this fall for lawmakers to take up legislation to revise the state’s tax code.

Speaker Armstead said Monday that option is on the table, but he is waiting to see what the committee comes up with. He doesn’t want to push fellow lawmakers to vote on legislation that hasn’t  been fully vetted and he is open to waiting until the 2016 session.

GOP-Led West Virginia Panel Starts Tax Reform Discussion

  A Republican-led legislative panel has started discussing possible changes to West Virginia’s tax code.

The Joint Select Committee on Tax Reform gathered for the first time during interim meetings Monday.

Senate President Bill Cole and House Speaker Tim Armstead want more study and tweaks to state taxes.

Lawmakers haven’t discussed many specifics yet.

Sen. Mike Hall, the committee’s co-chairman, says other states attract residents by eliminating personal income taxes. However, he acknowledged that would leave West Virginia with a revenue hole.

Additional meetings on May 4 and May 18 will feature presentations by various groups.

Cole has suggested a tax reform special session. Democratic Gov. Earl Ray Tomblin’s office has expressed concerns about the possible length and costs of a special session.

Otherwise, the Legislature returns for session in January.

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