West Virginia’s tax system is regarded as regressive because the lower one’s income, the higher one’s effective tax rate. While West Virginia has a progressive personal income (meaning the higher one’s income, the higher one’s effective personal income tax rate), it also, like most other states, relies heavily on the more regressive sales and excise taxes to raise revenue. Low-income West Virginians pay up to 6.6 percent of their income on sales and excise taxes, while the wealthiest in the state pay less than one percent of income in state and local sales taxes.
ITEP Work in Action
Advocates and policymakers at the state and federal levels rely on ITEP’s analytic capabilities to inform their debates on proposed tax policy changes. In any given year, ITEP fields requests for analyses of policies in 25 or more states. ITEP also works with national partners to provide analyses of federal tax policy proposals. This section highlights reports that use ITEP analyses to make a compelling case for progressive tax reforms.
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ITEP Work in Action October 17, 2018 West Virginia Center on Budget & Policy: Low-Income West Virginians Pay Far More in Taxes as a Percent of Income Than Wealthiest West Virginians
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ITEP Work in Action July 20, 2017 West Virginia Center on Budget & Policy: New Report Shows Trump Tax Plan Benefits Wealthy, Fails to Help Middle Class
A new analysis from the Institute on Taxation and Economic Policy reveals a federal tax reform plan based on President Trump’s April outline would fail to deliver on its promise of largely helping middle-class taxpayers, showering 61.4 percent of the total tax cut on the richest 1 percent nationwide. In West Virginia, the top 1 percent of the state’s residents would receive an average tax cut of $51,600 compared with an average tax cut of $720 for the bottom 60 percent of taxpayers in the state.
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ITEP Work in Action May 24, 2017 Evidence Counts: Senate Tax Plan Punches More Holes Into Budget (Updated)
Similar to previous tax plans from the Senate, this plan increase taxes on most West Virginians while lowering them for higher-income residents. According to the Institute on Taxation and Economic Policy, the Senate tax plan increases taxes on 60 percent of West Virginia households while lowering taxes on the top 40 percent of households. This is because lower income West Virginians pay more in sales taxes than income taxes, while the opposite is true for higher income people.
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ITEP Work in Action May 10, 2017 Evidence Counts: Latest Compromise Tax Plan Still a Bad Deal for West Virginia
Last week, the governor called the legislature back into special session to continue work on the state budget. The actual budget bill, however, was not part of the call, instead… -
ITEP Work in Action April 24, 2017 Evidence Counts: What is the Impact of the “Compromise Tax Proposal” on the Budget and Working Families?
Earlier this week, the West Virginia Center on Budget and Policy examined the fiscal impact of the proposed compromise tax plan between Governor Justice and Senate leadership that will influence how… -
ITEP Work in Action March 31, 2017 Evidence Counts: Senate Tax Plan Creates Big Budget Hole, Shifts Tax Load Onto Working Families (Updated)
Last Wednesday, the Senate passed Senate Bill 409 that makes sweeping changes to the state’s tax system that decrease personal income and severance taxes while increasing sales taxes. Similar to… -
ITEP Work in Action March 29, 2017 Evidence Counts: Tax Reform Might Improve WV’s Business Tax Climate, Sound Familiar?
Today, the House will vote on HB 2933, the latest version of “tax reform” in the state. HB 2933 would broaden the sales tax base, lower the sales tax rate… -
ITEP Work in Action March 26, 2017 Evidence Counts: House and Senate Tax Proposals Shift Tax Load Onto Working Families (Updated)
The House and the Senate have advanced two similar tax bills that make substantial changes to the state’s personal income and sales tax, which account for over 75 percent of… -
ITEP Work in Action March 20, 2017 Evidence Counts: Wealthiest 1% of West Virginians Gain from Tax Cuts in Health Care Repeal
The House proposal to repeal the federal Affordable Care Act (ACA) and replace it with the American Health Care Act (AHCA), provides only a tiny fraction of very wealthy West… -
ITEP Work in Action February 28, 2017 Evidence Counts: A Marriage Not Made in Heaven: A State EITC Without an Income Tax
Last Friday, the Senate Select Committee on Tax Reform explored the idea of amending SB 335 to include a version of a refundable state Earned Income Tax Credit. As noted… -
ITEP Work in Action February 21, 2017 Evidence Count: Governor Justice’s Tax Plan: Who Pays?
Governor Jim Justice has not introduced any tax measures yet, but in his State of the State Address and his executive budget there are plans to enact several tax increases to… -
ITEP Work in Action February 20, 2017 West Virginia Center on Budget & Policy: Income Tax Elimination is a Poor Growth Strategy
Unfazed by a $600 million looming budget deficit, plans by some lawmakers to reduce or eliminate West Virginia’s state income tax — which would mostly benefit the wealthiest residents —… -
ITEP Work in Action February 20, 2017 Evidence Counts: Replacing Income Taxes with a General Consumption Tax is Radical and Regressive (SB 335)
Senate leadership introduced SB 335 which would abolish the personal income tax and sales and use tax, phase out the corporate income tax, lower the severance tax, and replace these taxes… -
ITEP Work in Action February 17, 2017 West Virginia Center on Budget & Policy: What Would Eliminating the Income Tax Mean for West Virginia?
Eliminating the income tax is a strategy that has been tried over and over in other states with little or nothing to show, other than revenue erosion that brings cuts… -
ITEP Work in Action February 15, 2017 West Virginia Center on Budget & Policy: Replacing Income Tax with Sales Tax is a Boon for the Wealthy
Scale back income tax exemptions – Every taxpayer regardless of income receives a $2,000 exemption for each dependent. Phase it out between $150,000-$200,000, and eliminate it for those over $200,000,… -
ITEP Work in Action February 15, 2017 West Virginia Center on Budget & Policy: Income Tax Cuts and Shifting to Sales Tax a Poor Strategy for Growing West Virginia’s Economy
Even though faced with a $600 million budget deficit, some West Virginia lawmakers are proposing reducing or eliminating the state’s income tax, and replacing that lost revenue with an increase… -
ITEP Work in Action August 18, 2016 West Virginia Center on Budget and Policy: Modernizing West Virginia’s Marijuana Laws
“Over the last two decades, states across the country have modernized their marijuana laws to reflect the growing evidence that doing so will help reduce criminal justice costs, help treat… -
ITEP Work in Action May 17, 2016 West Virginia Center on Budget and Policy: New Revenues to Balance the Budget Don’t Have to be Regressive
“Last week, Governor Tomblin finally issued the call for the legislature to come back into a special session to balance the FY 2017 budget. The special session will begin today,… -
ITEP Work in Action April 5, 2016 West Virginia Center on Budget and Policy: Your Guide to the State Budget
“The state budget directly affects everyone living in West Virginia. It is the one law that makes state government function. It defines how we plan to use our resources to… -
ITEP Work in Action February 10, 2016 West Virginia Center on Budget and Policy: A Tax Cut That Works for Working Families: A West Virginia Earned Income Tax Credit
“Too many working families in West Virginia are paid low wages and have trouble making ends meet, with basic living expenses stretching family budgets beyond their limits. With tax overhaul… -
ITEP Work in Action May 20, 2015 West Virginia Center on Budget and Policy: Gutting the Personal Income is a Poor Strategy
As this post shows, the personal income tax is not only the largest source of revenue from state residents but it is also a progressive tax that helps reduce income… -
ITEP Work in Action January 21, 2015 West Virginia Center on Budget & Policy: Low- and Middle-Income Taxpayers in West Virginia Pay a Higher Tax Rate than the Richest West Virginians
A new study released today by the Institute on Taxation and Economic Policy (ITEP) and the West Virginia Center on Budget and Policy finds that the low- and middle-income West… -
ITEP Work in Action January 14, 2013 West Virginia Center on Budget and Policy: Making Work Pay: A State Earned Income Tax Credit for West Virginia
Due to the EITC’s overwhelming success, 24 states have their own SEITC programs modeled after the federal credit. A West Virginia SEITC would increase tax fairness and provide families with… -
ITEP Work in Action January 14, 2013 West Virginia Center on Budget and Policy: Giving Credit to West Virginia- A State EITC Would Help Struggling Families
Power Point Presentation before 80th West Virgina Legislature House Health and Human Resources Committee Chairman Perdue Read the Full Report (PDF)