FISCAL NOTE
Date Requested: February 24, 2016
Time Requested: 10:45 AM |
| Agency: |
Tax Department, State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2877 |
Introduced |
SB668 |
|
|---|
| CBD Subject: |
Education (K12), Taxation |
|---|
|
FUND(S):
West Virginia University Schools of Medicine, Dentistry and Nursing Fund, Joan C. Edwards School of Medicine of Marshall University, West Virginia School of Osteopathic Medicine
Sources of Revenue:
Special Fund
Legislation creates:
Neither Program nor Fund
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The stated purpose of this bill is to increase the excise tax on bottled soft drinks, syrups and dry mixtures and dedicate the proceeds to the benefit of the four-year school of medicine, dentistry and nursing of West Virginia University, the Joan C. Edwards School of Medicine of Marshall University and the West Virginia School of Osteopathic Medicine beginning in Fiscal Year 2017. The increase is from one cent to two cents on the bottled soft drinks and proportionally on syrups and dry mixtures.
According to our interpretation, passage of this bill would result in the doubling of the West Virginia Soft Drink Excise beginning on July 1, 2016. The net revenue gain to the State from the additional tax would range between $14.0 million and $14.5 million per year. The provisions of the bill would require deposit of half of total revenues generated from the tax, or $7.25 million, to the Joan C. Edwards School of Medicine of Marshall University and $7.25 million to the West Virginia School of Osteopathic Medicine.
The remaining half of all soft drink tax revenues ($14.5 million) would continue to be dedicated to the West Virginia University School of Medicine. Revenues dedicated to the West Virginia University School of Medicine would be expected to decrease slightly as a result of an anticipated small decline in soft drink consumption related to the imposition of additional tax. All of the proposed additional revenue will continue to be deposited into the special medical school fund in the State Treasury.
The tax rates in the proposed bill would double as follows:
• Tax on liquids doubles from 1 cent per half liter (16.9 fluid ounces) container or fraction thereof to 2 cents
• Tax on syrup would double from 80 cents per gallon to $1.60 per gallon
• Tax on dry mixture would double from 1 cent per 28.35 grams to 2 cents per 28.35 grams
Additional administrative costs would be $97,000 in FY2016 and $47,000 in FY2017, and $41,500 in FY2018 and thereafter.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2016
Increase/Decrease
(use"-") |
2017
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
97,000 |
47,000 |
41,500 |
| Personal Services |
0 |
41,500 |
41,500 |
| Current Expenses |
450 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
5,500 |
0 |
| Other |
96,550 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
According to our interpretation, passage of this bill would result in the doubling of the West Virginia Soft Drink Excise beginning on July 1, 2016. The net revenue gain to the State from the additional tax would range between $14.0 million and $14.5 million per year. The provisions of the bill would require deposit of half of total revenues generated from the tax, or $7.25 million, to the Joan C. Edwards School of Medicine of Marshall University and $7.25 million to the West Virginia School of Osteopathic Medicine.
The remaining half of all soft drink tax revenues ($14.5 million) would continue to be dedicated to the West Virginia University School of Medicine. Revenues dedicated to the West Virginia University School of Medicine would be expected to decrease slightly as a result of an anticipated small decline in soft drink consumption related to the imposition of additional tax. All of the proposed additional revenue will continue to be deposited into the special medical school fund in the State Treasury.
The tax rates in the proposed bill would double as follows:
• Tax on liquids doubles from 1 cent per half liter (16.9 fluid ounces) container or fraction thereof to 2 cents
• Tax on syrup would double from 80 cents per gallon to $1.60 per gallon
• Tax on dry mixture would double from 1 cent per 28.35 grams to 2 cents per 28.35 grams
Additional administrative costs would be $97,000 in FY2016 and $47,000 in FY2017, and $41,500 in FY2018 and thereafter.
Memorandum
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov