Jonathan Adler, Executive Director of the WV Association of Counties, posed the question, “How to pay for it?,” in an interview with the Charleston Gazette-Mail about the proposed elimination of business machinery, equipment, and inventory tax. This is the $91 million dollar question that hasn’t been successfully answered in the over two decades that this proposal has been discussed as a means to attract businesses to the state.
Almost all of the $91 million in personal property tax revenue goes to fund counties and schools, so funds to make them whole would have to be appropriated from the state. Based on the 2018 tax year, four counties (Brooke, Hancock, Jackson, & Pleasants) would have lost more than 20% of their property tax revenue if this property tax is eliminated. Conversely, there are 12 counties that would have lost less than $50,000. Kanawha County would have lost the largest amount in total revenue at $11.02 million but it amounts to just 5% of their total property tax collections.
SJR 8 is the resolution that, if passed, would put the issue on the ballot to amend the state Constitution. While a constitutional amendment on the ballot requires only a simple majority for passage, the resolution to amend the Constitution and place it on the ballot requires a 2/3 majority to pass the Legislature. In addition to the issue of replacing the revenue for counties and schools, the policy dilemma is whether or not the elimination of business personal property tax will actually attract businesses to the state and encourage new investment from businesses already here.
To read the Gazette article by Phil Kabler, click here. |