H. B. 2234
(By Delegate Walters)
[Introduced February 11, 2005; referred to the
Committee on Finance.]
Be it enacted by the Legislature of West Virginia
A BILL to amend and reenact §11-21-1 of the code of West Virginia,
1931, as amended; and to further amend said article by adding
thereto two new sections, designated §11-21-4g and §11-21-4h,
all relating to legislat
ive findings; providing for a five
percent tax reduction to all personal income tax rates.
of the code of West Virginia, 1931, as amended,
be amended and reenacted; and that said article be further amended
by adding thereto two new sections, designated §11-21-4g and
all to read as follows:
ARTICLE 21. PERSONAL INCOME TAX.
PART I. GENERAL.
§11-21-1. Legislative findings.
The Legislature hereby finds and declares that the
adoption by this state for its personal income tax purposes of the provisions of the laws of the United States relating to the
determination of income for federal income tax purposes will: (1)
Simplify preparation of state income tax returns by taxpayers; (2)
improve enforcement of the state income tax through better use of
information obtained from federal income tax audits; and (3) aid
interpretation of the state tax law through increased use of
federal judicial and administrative determinations and precedents.
(b) The Legislature further finds and declares that tax policy
is a legitimate instrument for state government to utilize in
efforts to stimulate small business and that too often the tax
policies in force have had an opposite effect.
(c) The Legislature further recognizes that the level of
poverty in this state is among the highest in the country while per
capita income is among the lowest and that reducing the personal
income tax will serve to reverse these troubling statistical
(d) The Legislature further finds and declares that in order
to provide tax relief to small businesses and individuals in this
state that any reduction in income taxes must be accompanied with
a commensurate reduction in the state budget.
(e) The Legislature further finds and declares that an across
the board income tax cut of five percent would significantly
stimulate the growth of small business, help toward the creation of
jobs and render relief to those citizens of this state who are in need of financial relief.
The Legislature does, therefore, declare that this article be
construed so as to accomplish the foregoing purposes.
§11-21-4g. Five percent reduction in all income tax rates.
There shall be a five percent reduction in all personal income
tax rates for taxable years ending on and after the first day of
January, two thousand five.
§11-21-4h. Rate of tax -- Taxable years beginning on or after
January 1, 2005.
(a) Rate of tax on individuals (except married individuals
filing separate returns), individuals filing joint returns, heads
of households, estates and trusts.
-- The tax imposed by section
three of this article on the West Virginia taxable income of every
individual (except married individuals filing separate returns);
every individual who is a head of a household in the determination
of his or her federal income tax for the taxable year; every
husband and wife who file a joint return under this article; every
individual who is entitled to file his or her federal income tax
return for the taxable year as a surviving spouse; and every estate
and trust shall be determined in accordance with the following
If the West Virginia
taxable income is:
The tax is:
Not over $10,0002.85% of the taxable income
Over $10,000 but not
$285.00 plus 3.8% of excess
Over $25,000 but not$855.00 plus 4.275% of excess
Over $40,000 but not$1,496.25 plus 5.7% of excess
over $60,000over $40,000
Over $60,000$2,636.25 plus 6.175% of excess
(b) Rate of tax on married individuals filing separate
-- In the case of husband and wife filing separate returns
under this article for the taxable year, the tax imposed by section
three of this article on the West Virginia taxable income of each
spouse shall be determined in accordance with the following table:
If the West Virginia
taxable income is:The tax is:
Not over $5,0002.85% of the taxable income
Over $5,000 but not$142.50 plus 3.8% of
excess over $10,000
Over $12,500 but not$427.50 plus 4.275% of
over $20,000excess over $12,500
Over $20,000 but not$748.13 plus 5.7% of
over $30,000excess over $20,000
Over $30,000$1,318.13 plus 6.175% of
excess over $30,000
(c) Applicability of this section.
-- The provisions of this
section shall be applied to determine the rate of tax imposed by
this article for all taxable periods or portions thereof beginning
after the first day of January, two thousand five.
NOTE: The purpose of this bill is to provide that all state
income tax taxpayers receive a reduction of five percent across the
board in their income tax rates. It includes legislative findings
that support these tax rate reductions and call for commensurate
reduction on the state budget to accompany any such tax reduction.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
§§11-21-4g and 4h are new; therefore, strike-throughs and
underscoring have been omitted.