CHARLESTON, W.Va. (AP) - West Virginia’s Senate has voted to raise the state’s gas tax by 4.5 cents a gallon while the House narrowly advanced a 1 percent cut in the state sales tax that would also eliminate certain exemptions.
The Senate’s 27-6 Saturday vote backs one of Gov. Jim Justice’s proposals to raise the basic state excise tax on gasoline from 20.5 cents per gallon to 25 cents on July 1. The bill now goes to the House. The West Virginia gasoline tax also has an additional variable rate component currently set at 11.7 cents a gallon.
The House of Delegates’ 50-44 vote Saturday allowed a bill to advance that would cut the state’s consumer sales tax from 6 percent to 5 percent. It would also eliminate the current exemption for gym memberships and food while setting the tax on groceries at 3 percent. The House was scheduled to consider possible amendments Monday.
According to House leaders, those tax changes, on top of $300 million of their proposed spending cuts and adjustments to Gov. Jim Justice’s earlier budget proposals, would close the state deficit next year.
Separately, the Senate is considering a broader tax overhaul that would raise the state sales and use tax to 7 percent, applying it more broadly to services including trash hauling, funerals, cosmetology, barbering, telecommunications and non-medical personal services.
The proposed overhaul would cut the graduated state income tax with the top rate dropping from 6.5 to 5 percent. It would also revise coal severance taxes, reducing them for narrower coal seams. The bill is pending in the Senate Finance Committee.
Income taxes would further decline by 0.1 percent for every $50 million annual increase in collections from the revised sales and use tax above $1.8 billion.
Both chambers will have to reconcile and approve their respective tax bills before the session ends in two weeks to make any of them effective. They’re also subject to signing or veto by the governor.
Justice has supported calls to eventually eliminate the state income tax but said it’s too soon this year. He has proposed an increase in the sales tax and a corporate revenue tax, both less than 1 percent, to close the deficit and using the gas tax to support bonding for a major road reconstruction program.
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