FISCAL NOTE
Date Requested: January 23, 2023
Time Requested: 04:39 PM |
| Agency: |
Tax & Revenue Department, WV State |
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| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1846 |
Introduced |
SB424 |
|
|---|
| CBD Subject: |
Governor -- Bills Requested By |
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|
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 authorize a tax credit against the personal income tax, or the corporation net income tax, as applicable, in the amount of ad valorem property tax timely paid during the income tax taxable year on specified motor vehicles. Specified motor vehicles are limited to Class A, Class B, Class G, Class H, Class T, Class V, and Class X motor vehicles, all-terrain vehicles and utility terrain vehicles. Tax credit is retroactive to taxable years beginning on and after January 1, 2022, and is refundable.
The bill would provide a refundable credit against the personal income tax liability of an individual or against the corporation net income tax of a corporation for ad valorem property taxes paid on vehicles owned by such individual or corporation. If the owner is a pass-through entity for federal income tax purposes, the credit may be taken by the eligible member. The credit is available for tax years beginning on or after January 1, 2022. The tax credit would be retroactive to Tax Year 2022 and could result in amended returns for that tax year. Based on current information and under the assumption that credit would be taken by all taxpayers paying Property Tax on vehicles, there would be a loss to the General Revenue Fund of up to $315.8 million in FY2024 and up to $157.9 in subsequent fiscal years.
Additional administrative costs would be $123,000 in FY2024, $120,000 in FY2025 and $95,000 in subsequent fiscal years.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2023
Increase/Decrease
(use"-") |
2024
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
123,000 |
90,000 |
| Personal Services |
0 |
90,000 |
90,000 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
33,000 |
0 |
| 2. Estimated Total Revenues |
0 |
-315,800,000 |
-157,900,000 |
Explanation of above estimates (including long-range effect):
The bill would provide a refundable credit against the personal income tax liability of an individual or against the corporation net income tax of a corporation for ad valorem property taxes paid on vehicles owned by such individual or corporation. If the owner is a pass-through entity for federal income tax purposes, the credit may be taken by the eligible member. The credit is available for tax years beginning on or after January 1, 2022. The tax credit would be retroactive to Tax Year 2022 and could result in amended returns for that tax year. Based on current information and under the assumption that credit would be taken by all taxpayers paying Property Tax on vehicles, there would be a loss to the General Revenue Fund of up to $315.8 million in FY2025 and up to $157.9 in subsequent fiscal years.
Additional administrative costs would be $123,000 in FY2024, $120,000 in FY2025 and $95,000 in subsequent fiscal years.
Memorandum
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov