(LOOTPRESS) – A goal of the West Virginia Legislature has been to make our state a zero-income tax state. It is easy to say this but getting buy in and agreement and a plan that accomplishes the goal is difficult and complicated.
The plan implemented last year made an initial cut of 21.25%. The plan also had triggers based on economic performance reflected by tax collections that would reduce this tax up to an additional 10% per year. This year that trigger resulted in an additional 4% cut making the total income tax cut 25.25%, solid progress forward with a long way to go.
The Governor has announced a special legislative session to consider an additional 5% cut. Taking the total cut to 30.25% at this point is a major accomplishment toward the stated goal and I am hopeful we can get it accomplished, however there is more to making this additional cut than simply enacting the law. The tax cuts require work and discipline on the other side of the balance sheet in order to be responsible to the citizens of West Virginia.
Cutting taxes has been proven to increase revenue based on the increased economic activity in generates. This increased activity takes time meaning the revenue is slow and over time. The cut in tax rates will result in less government revenue in the short
term. To fund government, spending must be held down and it must be utilized on those items that are truly within the role and requirements of government.
Please note that I didn’t say the budget must be restricted, I am saying all spending, including budgetary spending, back of the budget spending and supplemental spending. While typing this editorial that sounds easy but politically it is extremely difficult. If you have difficulty believing this, look at the special session spending and notice how often it is approved (almost always). If one wants to be popular in elected office spending money on projects that are in favor is one way to do it.
It is important to our state to eliminate the income tax. It is important to every individual that pays tax. It is important to every business that works here, and it is important to individuals that may want to locate here. More money in people’s pockets is good! It is
good if the government keeps its promises and pays its obligations and over obligating and spending beyond current revenue could be a problem for our state beyond my years.
We can accomplish another 5% income tax cut. We can only do it if elected legislators and the Governor are tough enough to say no to spending that is beyond available tax revenue and outside the true role of government.
