H. B. 2290
(By Delegates Walters, Nesbitt, Sprouse, Calvert,
Harrison, Henderson and Greear)
[Introduced January 31, 1995; referred to the
Committee on Government Organization then Finance.]
A BILL to amend and reenact section one, article twenty-one,
chapter eleven of the code of West Virginia, one thousand
nine hundred thirty-one, as amended; to further amend said
article by adding thereto a new section, designated section
four-g; to amend and reenact section one, article
twenty-four of said chapter; and to further amend said
article by adding thereto a new section, designated section
four-b, all relating to legislative findings; and providing
for a ten percent tax reduction to all personal income and
corporate net income tax rates.
Be it enacted by the Legislature of West Virginia:
That section one, article twenty-one, chapter eleven of the code of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted; that said article be further
amended by adding thereto a new section, designated section
four-g; that section one, article twenty-four of said chapter be
amended and reenacted; and that said article be further amended
by adding thereto a new section, designated section four-b, all
to read as follows:
ARTICLE 21. PERSONAL INCOME TAX.
§11-21-1. Legislative findings.
(a) The Legislature hereby finds and declares that the
adoption by this state for its personal income tax purposes of
the provisions of the laws of the United States relating to the
determination of income for federal income tax purposes will (1)
simplify preparation of state income tax returns by taxpayers,
(2) improve enforcement of the state income tax through better
use of information obtained from federal income tax audits, and
(3) aid interpretation of the state tax law through increased use
of federal judicial and administrative determinations and
precedents.
(b) The Legislature further finds and declares that tax policy is a legitimate instrument for state government to utilize
in efforts to stimulate small business and that too often the tax
policies in force have had an opposite effect.
(c) The Legislature further recognizes that the level of
poverty in this state is among the highest in the country while
per capita income is among the lowest and that reducing the
personal income tax will serve to reverse these troubling
statistical trends.
(d) The Legislature further finds and declares that in order
to provide tax relief to small businesses and individuals in this
state that any reduction in income taxes must be accompanied with
a commensurate reduction in the state budget.
(e) The Legislature further finds and declares that an
across the board income tax cut of ten percent would stimulate
the growth of small business, help create jobs and render relief
to those citizens of this state who are in need of financial
relief.
(f) The Legislature further finds and declares that the
estimated cost to the state in revenue loss as the result of a
ten percent reduction in income tax rates is sixty million dollars.
(g) The Legislature further finds and declares that in order
to offset the reduction in tax revenue that a ten percent
reduction in tax rates would cause, a state hiring freeze would
have to be adopted which contains provision for emergencies or
other contingencies that could arise, such as having to comply
with federal standards or mandates, or having to provide for
natural disasters or other situations that pose a risk to the
public health and safety and which would require the hiring of
additional state employees.
(h) The Legislature further finds and declares that in order
to reduce government spending without causing a significant loss
of necessary and beneficial governmental services that reductions
in government bureaucracy, waste and spending must be made.
Accordingly, the Legislature also finds and declares that the
following reductions in appropriation of public moneys listed in
the budget digest for fiscal year 1995 would serve the purposes
and policies stated herein:
(1) Reduce the appropriation to the department of education
in "former" account number 2860, "WVFIMS" account number fund 0313 FY 1995 Org 0402 by eleven million dollars;
(2) Reduce the appropriation to the governor's office in
"former" account number 1200 "WVFIMS" account number fund 0101 FY
1995 Org 0100 by twenty-eight thousand seven hundred thirty-two
dollars;
(3) Reduce the appropriation to the governor's office civil
contingent fund in "former" account number 1240 "WVFIMS" account
number fund 0105 FY 1995 Org 0100 by two hundred thousand
dollars;
(4) Eliminate all appropriations to the governor's cabinet
on children and families in "former" account number 1255 "WVFIMS"
account number fund 0104 FY 1995 Org 0100 line item 116. This
will result in savings of three hundred fifty-nine thousand six
hundred dollars;
(5) Reduce the appropriation to the auditor's office in
"former" account number 1500 "WVFIMS" account number fund 0116 FY
1995 Org 1200 line item 117 by two hundred fifty-five thousand
dollars;
(6) Reduce the appropriation to the treasurer's office in
"former" account number 1600 "WVFIMS" account number fund 0126 FY 1995 Org 1300 line item 441 by one hundred twenty-five thousand
dollars and line item 118 by two hundred thousand dollars;
(7) Reduce the appropriation to the attorney general's
office in "former" account number 2400 "WVFIMS" account number
fund 0150 FY 1995 org 1500 line item 099 by fifty thousand
dollars;
(8) Reduce the appropriation to the department of
agriculture in "former" account number 5150 "WVFIMS" account
number fund 0136 FY 1995 Org 1400 by forty-five thousand dollars;
(9) Reduce the appropriation to the department of
agriculture in "former" account number 5100 "WVFIMS" account
number fund 0131 FY 1995 Org 1400 by fifty thousand dollars;
(10) Reduce the appropriation to the division of finance
"former" account number 2110 "WVFIMS" account number fund 0203 FY
1995 Org 0209 line item 125 by five hundred thousand dollars;
(11) Reduce the appropriation to the division of general
services "former" account number 2130 "WVFIMS" account number
fund 0230 FY 1995 Org 0223 line item 503 by one hundred fifty
thousand dollars;
(12) Reduce the appropriation to the state board of education (vocational division) in "former" account number 2890
"WVFIMS" account number fund 0390 FY 1995 Org 0402 by one hundred
fifty thousand dollars from the total budget allotted thereto;
(13) Reduce the appropriation to the West Virginia schools
for the deaf and blind in "former" account number 3330 "WVFIMS"
account number fund 0320 FY 1995 Org 0403 by ninety thousand
dollars from line item 099;
(14) Reduce the appropriation to the board of trustees of
the university system in "former" account number 2795 "WVFIMS"
account number fund 0327 FY 1995 Org 0461 by seven hundred
thousand dollars from line item 099;
(15) Reduce the appropriation to the board of trustees of
the university system in "former" account number 2800 "WVFIMS"
account number fund 0333 FY 1995 Org 0452 by ninety thousand
dollars from line item 168 and two hundred fifty thousand dollars
from line item 169;
(16) Reduce the appropriation to the board of trustees of
the university system in university of West Virginia health
sciences account, "former" account number 2855 "WVFIMS" account
number fund 0323 FY 1995 Org 0478 by two million dollars;
(17) Reduce the appropriation for capital outlay to the
division of culture and history in "former" account number 3510
"WVFIMS" account number fund 0293 FY 1995 Org 0432 by one hundred
ninety thousand dollars;
(18) Reduce the appropriation to the division of culture and
history in "former" account number 3510 "WVFIMS" account number
fund 0293 FY 1995 Org 0432 for unclassified line item 099 by
three hundred thousand dollars;
(19) Reduce the appropriation to the department of education
and the arts, "former" account number 5332 "WVFIMS" account
number fund 0294 FY 1995 Org 0431 by two hundred thousand dollars
from line item 456;
(20) Reduce the appropriation to the division of health
central office, "former" account number 4000 "WVFIMS" account
number fund 0407 FY 1995 Org 0506 by three hundred thousand
dollars from line item 001 by one hundred thousand dollars from
line item 010 by fifty-eight thousand three hundred dollars from
line item 185;
(21) Reduce the appropriation to the division of human
services in "former" account number 4050 "WVFIMS" account number fund 0403 FY 1995 Org 0511 by eliminating by fifty-one thousand
three hundred sixty-five dollars from line item 191 by one
million dollars from line item 195 by five hundred thousand
dollars from line item 001 by twenty million dollars from line
item 189 by one hundred fifty thousand dollars from line item
010; to further reduce such appropriation by merging line item
199 with line item 197 while reducing the allotment for these
line items by one hundred thousand dollars. Also, merge line
item 191 with line item 196 and consolidate both under line item
195 while reducing the budget under line item 195 by one hundred
thousand dollars;
(22) Reduce the appropriation to the consolidated medical
service fund, "former" account number 4190 "WVFIMS" account
number fund 0525 FY 1995 Org 0506 by merging line item 210, line
item 211 and line item 212 while reducing the overall budget for
these items by three hundred thousand dollars. Also, merge line
item 217 and line item 493 while reducing the overall budget for
these items by fifty thousand dollars. Budget reductions should
also be made from line item 001 and line item 010 only.
Additionally, eliminate funding for line item 225 which would result in a savings of one hundred eighty-six thousand six
hundred thirty-two dollars;
(23) Reduce appropriation for the human rights commission in
"former" account number 5980 "WVFIMS" account number fund 0416 FY
1995 Org 0510 by an overall budget reduction of fifty thousand
dollars;
(24) Reduce appropriation for the department of
transportation office of the secretary in "former" account number
5376 "WVFIMS" account number fund 0500 FY 1995 Org 0801 by
reducing line item 443 by two hundred thousand dollars, and by
eliminating line item 444 and thereby saving fifty thousand
dollars;
(25) Reduce appropriation for the railroad maintenance
authority in "former" account number 5690 "WVFIMS" account number
fund 0506 FY 1995 Org 0804 by eliminating line item 497 and
thereby saving twenty-five thousand dollars;
(26) Reduce appropriation for the division of highways in
"former" account number 6700 "WVFIMS" account number fund 9017 FY
1995 Org 0803 by reducing five million dollars from line item
271, two million dollars from line item 272, one million dollars from line item 277, one million dollars from line item 281 and
five hundred thousand dollars from line item 282;
(27) Reduce appropriation for the division of motor vehicles
in "former" account number 6710 "WVFIMS" account number fund 9007
FY 1995 Org 0802 by reducing line item 283 by two hundred
thousand dollars and line item 284 by fifty thousand dollars;
(28) Reduce appropriation for the division of natural
resources, planning and development division in "former" account
number 8306 "WVFIMS" account number fund 3205 FY 1995 Org 0310 by
eliminating line item 249 thereby saving fifty thousand dollars;
(29) Reduce appropriation for the division of natural
resources in "former" account number 8300 "WVFIMS" account number
fund 3200 FY 1995 Org 0310 by reducing line item 001 by six
hundred thousand dollars and by reducing allotments for benefits
by two hundred thousand dollars;
(30) Reduce appropriation for the state department of
education school building authority in "former" account number
8247 "WVFIMS" account number fund 3959 FY 1995 Org 0402 by two
hundred thousand dollars by transferring all functions of the
authority to the state department of education and, thereby, eliminating the building authority;
(31) Eliminate appropriation for the vice chancellor for
health sciences health care reform studies in "former" account
number 9285 "WVFIMS" account number fund FY 1995 Org thereby
saving two hundred twenty thousand dollars;
(32) Eliminate appropriation for the hospital finance
authority in "former" account number 8330, "WVFIMS" account
number fund 5475 FY 1995 Org 0509 thereby saving one hundred
twenty-nine thousand six hundred twenty-seven dollars;
(33) Reduce appropriation for the public service commission
in "former" account number 8280 "WVFIMS" account number fund 8623
FY 1995 Org 0926 by reducing line item 001 by three hundred
thousand dollars, line item 010 by one hundred thousand dollars
and line item 099 by one hundred thousand dollars;
(34) Reduce appropriation for the state department of
education in "former" account number 8243 "WVFIMS" account number
fund 3951 FY 1995 Org 0402 by reducing line item 440 by one
million dollars;
(35) Reduce appropriation for the division of tourism and
parks in "former" account number 8546 "WVFIMS" account number fund 3067 FY 1995 Org 0304 by reducing line item 099 by five
hundred thousand dollars and line item 288 by two hundred fifty
thousand dollars;
(36) Reduce appropriation to the board of trustees of the
university system and to the board of directors of the state
college system in "former" account 8825 "WVFIMS" account number
fund 4030 FY 1995 Org 0453 by reducing line item 096 by three
hundred thousand dollars;
(37) Limit the expenditure for state travel at twelve
million dollars from the current level of fifteen million
dollars;
(38) Freeze all salaries of state employees in excess of
forty thousand dollars for four years; and
(39) Eliminate one third of all existing job vacancies in
state government at an estimated annual cost savings of fourteen
million dollars.
The Legislature does, therefore, declare that this article
be construed so as to accomplish the foregoing purposes and
goals.
§11-21-4g. Ten percent income tax reduction.
For taxable years ending on and after the first day of July,
one thousand nine hundred ninety-four, there shall be a ten
percent reduction in all personal income tax rates.
ARTICLE 24. CORPORATION NET INCOME TAX.
§11-24-1. Legislative findings.
(a) The Legislature hereby finds and declares that the
adoption by this state for its corporation net income tax
purposes of certain provisions of the laws of the United States
relating to the determination of income for federal income tax
purposes will (1) simplify preparation of state corporation net
income tax returns by taxpayers, (2) improve enforcement of the
state corporation net income tax through better use of
information obtained from federal income tax audits, and (3) aid
interpretation of the state corporation net income tax law
through increased use of federal judicial and administrative
determinations and precedents.
(b) The Legislature further finds and declares that tax
policy is a legitimate instrument for state government to utilize
in efforts to stimulate small business and that too often the tax
policies in force have had an opposite effect.
(c) The Legislature further recognizes that the level of
unemployment in this state is unacceptably high while per capita
income is among the lowest in the country and that reducing the
corporate net income tax will serve to reverse these troubling
statistical trends.
(d) The Legislature further finds and declares that in order
to provide tax relief to small businesses and individuals in this
state that any reduction in income taxes must be accompanied with
a commensurate reduction in the state budget.
(e) The Legislature further finds and declares that an
across the board income tax cut of ten percent would stimulate
the growth of small business, help create jobs and render relief
to those citizens of this state who are in need of financial
relief.
(f) The Legislature further finds and declares that the
estimated cost to the state in revenue loss as the result of a
ten percent reduction in income tax rates is sixty million
dollars.
(g) The Legislature further finds and declares that in order
to offset the reduction in tax revenue that a ten percent reduction in tax rates would cause, a state hiring freeze would
have to be adopted which contains provision for emergencies or
other contingencies that could arise, such as having to comply
with federal standards or mandates, or having to provide for
natural disasters or other situations that pose a risk to the
public health and safety and which would require the hiring of
additional state employees.
(h) The Legislature further finds and declares that in order
to reduce government spending without causing a significant loss
of necessary and beneficial governmental services, reductions in
government bureaucracy, waste and spending must be made.
Accordingly, the Legislature also finds and declares that the
reductions in appropriation of public moneys for fiscal year one
thousand nine hundred ninety-five, as set forth in section one,
article twenty-one of this chapter, would serve the purposes and
policies stated herein.
The Legislature does therefore declare that this article
twenty-four be construed so as to accomplish the foregoing
purposes.
§11-24-4b. Ten percent reduction for all rates.
For taxable years ending on and after the first day of July,
one thousand nine hundred ninety-five, there shall be a ten
percent reduction in any corporate net income tax rate.
NOTE: This bill provides that all personal and corporate
taxpayers receive a ten percent across the board tax reduction.
It includes legislative findings that support the tax reductions.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.
Section four-g, article twenty-one and section four-b,
article twenty-four are new; therefore, strike-throughs and
underscoring are omitted.