West Virginia House Approves 2% Income Tax Cut: What It Means for Families

On October 8, 2024, the West Virginia House of Delegates approved Governor Jim Justice’s proposal for a 2% cut to the state’s personal income tax. This follows a previously enacted 4% tax cut set to take effect in January 2025 due to an economic trigger. The new 2% reduction, which is projected to save the average West Virginia family around $200 annually, will also commence in January.

House Finance Chairman Vernon Criss emphasized the importance of reducing the tax burden on families, stating, Even a little bit is meaningful. A gallon of milk helps families. The overall cost of implementing this tax cut is estimated at $46 million, with approximately $27 million sourced from available funds within the Departments of Human Services, Health, and Health Facilities, created after the restructuring of the former Department of Health and Human Resources.

However, this funding source raised concerns among House Democrats, who pointed to the pressing needs of vulnerable populations, including nearly 6,000 children in foster care and the ongoing funding needs for child care subsidy programs.

House Minority Leader Sean Hornbuckle criticized the move as politically motivated, given its timing just weeks before the elections, and highlighted the potential negative impact on child welfare services.

Democrats proposed an amendment to delay the tax cut until the Department of Human Services could ensure all foster children were placed in suitable home-like settings, which ultimately failed.

The Senate had previously approved the bill, with funding for part of the tax cut being covered by an expiring revenue bond. Initially, Justice had sought a 5% income tax reduction but scaled back his request amid budgetary concerns.