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 exempt from state income tax, for five years, veterans and their spouses who locate in the state following separation from military service.
According to our interpretation, passage of this bill would result in a decrease in State General Revenue Fund collections of at least $40.6 million per year beginning in FY 2015. Due to the lack of an internal effective date, this bill would not become effective until the 2014 tax year.
The bill provides for a blanket income tax exemption to honorably discharged veterans and their spouse for a period of five years following separation from military service. The bill also expands the five-year exemption qualification to any veteran, who was honorably discharged within a ten-year period of the bill’s effective date.
If all returns were accepted as filed, additional costs to the State Tax Department associated with passage of this bill would be minimal. However, the bill contains a number of uncertainties that may cause significant administrative difficulties and increased costs.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2013
Increase/Decrease
(use"-") |
2014
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 |
0 |
-40,600,000 |
Explanation of above estimates (including long-range effect):
This bill provides a five-year blanket income tax exemption from the resident personal income tax to all honorably discharged veterans of the past ten years. Passage of this bill will reduce General Revenue Fund collections by at least $40.6 million per year beginning in FY 2015. The provisions of the bill would apply to all honorably discharged members of the military, who received their discharge over the past ten years.
If all returns were accepted as filed, additional costs to the State Tax Department associated with passage of this bill would be minimal. However, the bill contains a number of uncertainties that may cause significant administrative difficulties and increased costs
Memorandum
The stated purpose of this bill is to exempt from state income tax, for five years, veterans and their spouses who locate in the state following separation from military service.
As written, the bill contains a number of uncertainties that may cause significant administrative difficulties.
Person submitting Fiscal Note: Mark B. Muchow
Email Address: Roger.D.Cox@wv.gov