FISCAL NOTE
Date Requested: February 03, 2020
Time Requested: 11:30 AM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2911 |
Introduced |
HB4650 |
|
|---|
| CBD Subject: |
Taxation |
|---|
|
FUND(S):
General Revenue Fund
Sources of Revenue:
General Fund
Legislation creates:
Decreases Existing Revenue, Increases Existing Expenses
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The stated purpose of this bill is to lower the excise tax rate on the sale of cigarettes.
The proposed bill would reduce the excise tax on cigarettes from $1.20 on each 20 cigarettes or in like ratio on any part thereof to $0.30 on each 20 cigarettes or in like ratio on any part thereof. The effective date of the change is July 1, 2020. Based on our interpretation, the passage of the proposed legislation would decrease General Revenue Fund collections by $100 million in FY2021 and $110 million in FY2022.
Additional administrative costs incurred by the Tax Department would be $60,000 in FY2020, $30,000 in FY2021 and $5,000 in subsequent fiscal years.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2020
Increase/Decrease
(use"-") |
2021
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
60,000 |
30,000 |
5,000 |
| Personal Services |
10,000 |
30,000 |
5,000 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
50,000 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
-100,000,000 |
-110,000,000 |
Explanation of above estimates (including long-range effect):
The proposed bill would reduce the excise tax on cigarettes from $1.20 on each 20 cigarettes or in like ratio on any part thereof to $0.30 on each 20 cigarettes or in like ratio on any part thereof. The effective date of the change is July 1, 2020. Based on our interpretation, the passage of the proposed legislation would decrease General Revenue Fund collections by $100 million in FY2021 and $110 million in FY2022.
Additional administrative costs incurred by the Tax Department would be $60,000 in FY2020, $30,000 in FY2021 and $5,000 in subsequent fiscal years.
Memorandum
The stated purpose of this bill is to lower the excise tax rate on the sale of cigarettes.
The bill does not delete the most recent rate of tax although it deletes the rate of tax prior to July 1, 2016. The current rate of tax on cigarettes, imposed on and after July 1, 2016, is $1.20 on each 20 cigarettes or like ratio on any part thereof.
There are typographical errors: “…or in like ration any part thereof” should be changed or corrected to …. or in like ratio on any part thereof.
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov