FISCAL NOTE



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 exemption on retirement income from taxation on persons age sixty-five years of age or older or a surviving spouse of such persons from $8,000 to $15,000 a year. The bill, as written, increases the modification for senior citizens and persons who are totally and permanently disabled from $8,000 to $15,000, effective for tax years beginning after December 31, 2007. This increase in the decreasing modification allowed would result in a loss to the General Revenue Fund of roughly $31.0 million beginning in Tax Year 2008. There would be no additional administrative costs.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2008
Increase/Decrease
(use"-")
2009
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 -31,000,000 -31,000,000


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


The bill, as written, increases the modification for senior citizens and persons who are totally and permanently disabled from $8,000 to $15,000, effective for tax years beginning after December 31, 2007. This increase in the decreasing modification allowed would result in a loss to the General Revenue Fund of roughly $31.0 million beginning in Tax Year 2008. Costs will rise significantly after 2011 when baby-boomers begin to qualify for this modification. There would be no additional administrative costs.



Memorandum






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