FUND(S):

General Revenue Fund

Sources of Revenue:

General Fund

Legislation creates:

Neither Program nor Fund



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


    The stated purpose of this bill is to increase the low-income exclusion for personal income tax.
    
    According to our interpretation, passage of this bill would reduce General Revenue Fund collections by roughly $24.7 million in Fiscal Year 2005-2006 and by roughly $26.9 million per year, thereafter. The bill would increase the low-income earned-income exclusion threshold from $10,000 to $18,000 for single, joint and head of household returns and from $5,000 to $9,000 for married-filing-separate returns.
    
    There would be no additional administrative costs to the Tax Department associated with this bill.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2005
Increase/Decrease
(use"-")
2006
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 0 0
Personal Services 0 0 0
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 -24,700,000 -26,900,000


Explanation of above estimates (including long-range effect):


    This bill would increase the low-income earned-income exclusion threshold from $10,000 to $18,000 for single, joint and head of household returns and from $5,000 to $9,000 for married-filing-separate returns. The change would benefit up to 118,000 taxpayers at a cost of roughly $26.9 million per year to the General Revenue Fund.
    
    There would be no additional administrative costs to the Tax Department associated with this bill.



Memorandum


     Person submitting Fiscal Note: Mark Muchow
     Email Address: kpetry@tax.state.wv.us