Date Requested:February 27, 2013
Time Requested:01:25 PM
Agency: State Tax & Revenue Department
CBD Number: Version: Bill Number: Resolution Number:
2013R2251 Introduced SB380
CBD Subject: TAX CREDIT FOR EMPLOYERS
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 purpose of this bill is to expand the Military Incentive Program to include all economically disadvantaged veterans.
    
     According to our interpretation this bill would expand the definition of the employees eligible for an existing tax credit program. The tax credit would apply for each person or partnership or corporation which employs an economically disadvantaged veteran, or any disabled veteran, or an unemployed member of the West Virginia National Guard or a member of the reserve forces of the United States for a continuous period of one year. In the case of a person or partnership employing such individuals the tax credit provided would be applied against the employer’s Personal Income Tax liability. In the case of a corporation employing such individuals, the tax credit would be applied against the corporation’s Corporation Net Income Tax liability. The State Tax Department does not have sufficient data to accurately estimate the potential revenue impact of this expansion of an existing tax credit program. A calculation based on the number of potential employees generates an estimate between $4 million and $5 million. However, past experience with this program suggests that actual use of this tax credit is always significantly lower than the potential use.
    
     The bill would provide tax credit in the amount of 30% of the first $5,000 in wages paid to each economically disadvantaged veteran employed. For employing each disabled veteran the tax credit allowed would be percentage equal to the percentage of disability suffered by the veteran multiplied by the first $5,000 in wages paid by the employer. For employing each member of the West Virginia National Guard or member of the reserve forces of the United States, the amount of tax credit allowed will be 25% of the first $5,000 in wages paid by the employer.
    
     Additional administrative costs to the State Tax Department associated with passage of this bill would be minimal.
    

Fiscal Note Detail
Over-all effect
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 0
3. Explanation of above estimates (including long-range effect):
     The purpose of this bill is to expand the Military Incentive Program to include all economically disadvantaged veterans.
    
     According to our interpretation this bill would expand the definition of the employees eligible for an existing tax credit program. The tax credit would apply for each person or partnership or corporation which employs an economically disadvantaged veteran, or any disabled veteran, or an unemployed member of the West Virginia National Guard or a member of the reserve forces of the United States for a continuous period of one year. In the case of person or partnership employing such individuals the tax credit provided would be applied against the employer’s Personal Income Tax liability. In the case of a corporation employing such individuals, the tax credit would be applied against the corporation’s Corporation Net Income Tax liability. The State Tax Department does not have sufficient data to accurately estimate the potential revenue impact of this expansion of an existing tax credit program. A calculation based on the number of potential employees generates an estimate between $4 million and $5 million. However, past experience with this program suggests that actual use of this tax credit is always significantly lower than the potential use.
    
     The bill would provide tax credit in the amount of 30% of the first $5,000 in wages paid to each economically disadvantaged veteran employed. For employing each disabled veteran the tax credit allowed would be percentage equal to the percentage of disability suffered by the veteran multiplied by the first $5,000 in wages paid by the employer. For employing each member of the West Virginia National Guard or member of the reserve forces of the United States, the amount of tax credit allowed will be 25% of the first $5,000 in wages paid by the employer.
    
     Additional administrative costs to the State Tax Department associated with passage of this bill would be minimal.
    


Memorandum
Person submitting Fiscal Note:
Mark B. Muchow
Email Address:
Roger.D.Cox@wv.gov
     The purpose of this bill is to expand the Military Incentive Program to include all economically disadvantaged veterans.
    
     The bill expands the Military Incentive Program to include the employment of economically disadvantaged veterans other than those who served during the Vietnam and Korean conflicts.
    
     Replace the term “handicapped” with the more accurate therm “disabled.” A handicap is a barrier or circumstance that makes progress or success difficult, such as an impassable flight of stairs or a negative attitude towards a person who has a disability. A disability is the result of a medically definable condition that limits a person’s movements, senses, or activities.