FISCAL NOTE
FUND(S):
Division of Forestry Severance Tax Operations Fund
Sources of Revenue:
Special 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 remove a severance tax on timber for tax years 2010 through 2013, inclusive.
According to our interpretation, passage of this bill would discontinue the Severance Tax on timber levied via W. Va. Code §11-13A-3b for a four-year period. The bill would reduce the Severance Tax paid on timber by roughly $1.0 million for tax years 2010, 2011, 2012, and 2013 and then the temporary discontinuation would expire. Since some taxpayers are required to make estimated payments, the resultant reductions in the Division of Forestry Severance Tax Operations Fund by fiscal year would be as follows: Fiscal Year 2010 - $300,000; Fiscal Years 2011, 2012, and 2013 - $1.0 million: and Fiscal Year 2014 - $0.7 million. The bill also indicates that the tax imposed on timber via W. Va. Code §11-13V-4(c) shall continue as if the W. Va. Code §11-13A-3b tax was still being imposed. Therefore, there would be no change in revenue for the Workers’ Compensation Debt Reduction Fund.
Additional administrative costs to the State Tax Department associated with this bill would be minimal.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2009
Increase/Decrease
(use"-") |
2010
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 |
-300,000 |
-1,000,000 |
Explanation of above estimates (including long-range effect):
As written, passage of this bill would discontinue the Severance Tax on timber levied via W. Va. Code §11-13A-3b for a four-year period. The bill would reduce the Severance Tax paid on timber by roughly $1.0 million for tax years 2010, 2011, 2012, and 2013 and then the temporary discontinuation would expire. Since some taxpayers are required to make estimated payments, the resultant reductions in the Division of Forestry Severance Tax Operations Fund by fiscal year would be as follows: Fiscal Year 2010 - $300,000; Fiscal Years 2011, 2012, and 2013 - $1.0 million: and Fiscal Year 2014 - $0.7 million. The bill also indicates that the tax imposed on timber via W. Va. Code §11-13V-4(c) shall continue as if the W. Va. Code §11-13A-3b tax was still being imposed. Therefore, there would be no change in revenue for the Workers’ Compensation Debt Reduction Fund.
Additional administrative costs to the State Tax Department associated with this bill would be minimal.
Memorandum
Person submitting Fiscal Note: Mark Muchow
Email Address: kpetry@tax.state.wv.us