Justice explains proposed taxes on soda pop and tobacco products during town hall on possible state income tax repeal

West Virginia Headlines

CHARLESTON, W.Va. (WTRF) Governor Jim Justice held his second virtual town hall this evening on the proposed repeal of the state income tax.

Participants from across West Virginia submitted questions before the town hall which were read by a moderator. A panel of state officials and state attorneys were in attendance along with Justice to answer questions.

The proposed tax repeal would go into effect on January 1, 2022 and would first reduce the state income tax repeal by 50 percent.

A proposed sales tax would not go over 10 percent, said Justice and would likely increase by only 1.5 to 1.9 percent.

Soda pop, alcohol and tobacco products may be taxed. The cigarette tax is now $1.30. Details about taxes on e-cigarettes are being discussed by state officials.

West Virginia has not raised the 1 cent tax on soda pop since 1952, Justice said. He gave the example of an average family spending an extra $80 per year on the new tax which is approximately 1600 pops total. Justice said if people are drinking that many pops, they have bigger problems than taxes.

Regarding any new consumer sales taxes, Justice stated that West Virginians will receive more back in tax relief than what they have to pay. The current consumer sales tax is 6 percent and Justice and state officials are proposing to raise this to approximately

Justice said there would be no tax on Social Security and the state is also looking into phasing out the retirement fund tax.

There would also be a luxury tax, Justice said, on items such as jewelry that cost more than five thousand dollars. Homes and vehicles will not be included in this tax.

Justice said he will not raise the state budget over the next three years. However, he said he hopes to pare back the state workforce which will amount to a $10 million savings.

He said there will be no increase in tuition for higher education.

There will also be no changes to Medicaid. While the panel of officials tonight said there would be no tax on items people purchase with food stamps, they noted that the food stamp program is run at the federal level so state mandates for a tax would not happen. One question came from a person who asked if pop could be purchased with food stamps, and the panel said yes, it can.

The panel said there will be no tax on prescriptions or medical procedures.

Justice stated that the proposed elimination of the state income tax would appeal to people and businesses from other states.

“The whole key is to raise demand for labor,” he said.

Governor Justice concluded by saying he plans to have as many town halls as possible.

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