FISCAL NOTE

Date Requested: February 11, 2021
Time Requested: 01:58 PM
Agency: Tax & Revenue Department, WV State
CBD Number: Version: Bill Number: Resolution Number:
1698 Introduced SB225
CBD Subject:


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 create a tax credit for individuals who successfully complete a firearms safety course. According to our interpretation, the proposed bill would create a non-refundable Personal Income Tax credit for individuals who successfully complete a firearms safety course. The credit is effective for tax years beginning January 1, 2021, and the maximum amount of credit per individual is $250 per person. The tax credit is not subject to carryback and unused credit is forfeited. The amount of credit is not based on costs incurred in enrolling and completing a firearms safety course. Therefore, the amount of credit claimed up to the maximum amount would only be limited by the taxpayer’s tax liability. As written, a taxpayer and each person in their household could earn and claim the credit in successive years. Based on our interpretation, the passage of the proposed legislation would create a loss in General Revenue collections of $1.6 million in FY2022 and in subsequent fiscal years. Additional administrative cost incurred by the State Tax Department are expected to be $51,000 in FY2022 and $40,000 in subsequent years. 



Fiscal Note Detail


Effect of Proposal Fiscal Year
2021
Increase/Decrease
(use"-")
2022
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 51,000 40,000
Personal Services 0 40,000 40,000
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 1,000 0
Other 0 10,000 0
2. Estimated Total Revenues 0 -1,600,000 -1,600,000


Explanation of above estimates (including long-range effect):


According to our interpretation, the proposed bill would create a non-refundable Personal Income Tax credit for individuals who successfully complete a firearms safety course. The credit is effective for tax years beginning January 1, 2021, and the maximum amount of credit per individual is $250 per person. The tax credit is not subject to carryback and unused credit is forfeited. The amount of credit is not based on costs incurred in enrolling and completing a firearms safety course. Therefore, the amount of credit claimed up to the maximum amount would only be limited by the taxpayer’s tax liability. As written, a taxpayer and each person in their household could earn and claim the credit in successive years. Based on our interpretation, the passage of the proposed legislation would create a loss in General Revenue collections of $1.6 million in FY2022 and in subsequent fiscal years. Additional administrative cost incurred by the State Tax Department are expected to be $51,000 in FY2022 and $40,000 in subsequent years.



Memorandum


The stated purpose of this bill is to create a tax credit for individuals who successfully complete a firearms safety course. The bill purports to authorize a credit of up to $250 for a “qualified individual” who enrolls in and successfully completes a firearm safety course. “Qualified individual” is not defined. The amount of credit is not linked to the cost of the course. The bill does not specify that only one credit is allowed per taxpayer or per taxpayer’s household. As written, a taxpayer and other household members may take a firearm safety course each year to receive the credit. One household could receive several credits over several years.



    Person submitting Fiscal Note: Mark Muchow
    Email Address: kerri.r.petry@wv.gov