FISCAL NOTE
Date Requested: February 10, 2026
Time Requested: 03:13 PM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 4027 |
Introduced |
HB5402 |
|
|---|
| CBD Subject: |
Taxation |
|---|
|
FUND(S):
General Revenue Fund
Sources of Revenue:
General Fund
Legislation creates:
Decreases Existing Revenue, Creates New Expense
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
Summarize in a clear and concise manner what impact this measure will have on costs and revenues of state government.
The stated purpose of this bill is to establish the Distribution Center Refundable Toll Payments Tax Credit through use of RFID Tag Reader systems at qualified distribution centers to compile refundable toll payments. The bill allows the promulgation of administrative rules. Finally, the bill provides for an effective date.
This bill would allow a tax credit to every business that operates a qualified distribution center in West Virginia equal to all toll payments made above $150,000 via the West Virginia EZ Pass system. This credit would be available for tolls paid for ground transportation delivery of product or inventory and return. The bill does not specify which taxes the credit may be applied against, and is effective July 1, 2026, retroactive to the beginning of the 2026 tax year. The revenue loss from the provisions of this bill could be up to $3.1 million based on the maximum potential tax credit is all entities were to meet all of the qualifications. However, the outcome could less than that due to the other requirements of the bill.
Administrative costs to the State Tax Division would be $33,000 in FY2026 and $11,000 in subsequent fiscal years.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2026
Increase/Decrease
(use"-") |
2027
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
33,000 |
11,000 |
11,000 |
| Personal Services |
11,000 |
11,000 |
11,000 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
22,000 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
Please explain increases and decreases in personal services, current expenses, repairs and alterations, assets, other costs and revenues, including assumptions and data sources and delineation between start-up and ongoing costs. Please also include a long-range schedule of costs and revenues if fiscal impact is expected to vary in future years.
This bill would allow a tax credit to every business that operates a qualified distribution center in West Virginia equal to all toll payments made above $150,000 via the West Virginia EZ Pass system. This credit would be available for tolls paid for ground transportation delivery of product or inventory and return. The bill does not specify which taxes the credit may be applied against, and is effective July 1, 2026, retroactive to the beginning of the 2026 tax year. The revenue loss from the provisions of this bill could be up to $3.1 million based on the maximum potential tax credit is all entities were to meet all of the qualifications. However, the outcome could less than that due to the other requirements of the bill.
Administrative costs to the State Tax Division would be $33,000 in FY2026 and $11,000 in subsequent fiscal years.
Memorandum
Please identify any areas of vagueness, technical defects, reasons a bill would not have a fiscal impact, and/or any special issues not captured elsewhere on this form.
The stated purpose of this bill is to establish the Distribution Center Refundable Toll Payments Tax Credit through use of RFID Tag Reader systems at qualified distribution centers to compile refundable toll payments. The bill allows the promulgation of administrative rules. Finally, the bill provides for an effective date.
The amount of the credit is tied to the toll payments made via the West Virginia EZ Pass system. Specifically, the credit is “a dollar-for-dollar tax credit for all toll payments paid above $150,000.” Presumably, this means that, if a “qualified distribution center” paid tolls totaling $200,000 in a tax year, the amount of available credit for that tax year would be $50,000. The bill is silent with regard to what taxes the credit can be applied against.
The effective date language is: “The provisions of this article will be treated as effective as of July 1, 2026, but the credit shall be allowed to be claimed against all toll payments above $150,000 made within the West Virginia EZ Pass system in Tax Year 2026 and each tax year thereafter.” Retroactivity to the beginning of the 2026 tax year is uncertain, given this language.
Person submitting Fiscal Note: Peter Shirley
Email Address: radfiscal@wv.gov