FISCAL NOTE
Date Requested: January 20, 2020
Time Requested: 02:25 PM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2303 |
Introduced |
SB521 |
|
|---|
| 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 provide for job creation and economic incentives. The bill makes findings and states its purpose. The bill creates the Tax and Economic Incentives Review Committee, and establishes who may serve on that committee. The bill establishes the committee’s powers. The bill provides for the review of all tax and economic incentives every five years. The bill provides guidelines for the review of incentives. The bill requires reports, define terms.
According to our interpretation, the duty of tax incentive evaluations would be transferred from the Tax Department to a newly established Tax and Economic Incentives Review Committee consisting of a certified public accountant, two economic development representatives, an auditor employed by a private auditing firm, representatives from both the West Virginia University John Chambers College of Business and Economics and Marshall University Lewis College of Business, the president of the West Virginia Economic Development Authority, the West Virginia Secretary of Commerce, the West Virginia Secretary of Revenue, and the West Virginia Legislative Auditor. While having no official duties, the Tax Department would likely be called upon to provide research support for the publishing of a report by this committee. Data collection of eligible individual and business employers would likely utilize survey research, which will add significantly to the administrative costs incurred by this proposed committee. Such a process could also significantly increase compliance costs for individuals and businesses benefitting from one or more incentives should the Review Committee wish to perform an in-depth analysis of any program beyond information currently available.
Administrative costs incurred by the State Tax Department would be $10,000 in FY2021 and fiscal years thereafter.
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 |
0 |
0 |
10,000 |
| Personal Services |
0 |
0 |
10,000 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
According to our interpretation, the duty of tax incentive evaluations would be transferred from the Tax Department to a newly established Tax and Economic Incentives Review Committee consisting of a certified public accountant, two economic development representatives, an auditor employed by a private auditing firm, representatives from both the West Virginia University John Chambers College of Business and Economics and Marshall University Lewis College of Business, the president of the West Virginia Economic Development Authority, the West Virginia Secretary of Commerce, the West Virginia Secretary of Revenue, and the West Virginia Legislative Auditor. While having no official duties, the Tax Department would likely be called upon to provide research support for the publishing of a report by this committee. Data collection of eligible individual and business employers would likely utilize survey research, which will add significantly to the administrative costs incurred by this proposed committee. Such a process could also significantly increase compliance costs for individuals and businesses benefitting from one or more incentives should the Review Committee wish to perform an in-depth analysis of any program beyond information currently available.
Administrative costs incurred by the State Tax Department would be $10,000 in FY2021 and fiscal years thereafter.
Memorandum
The stated purpose of this bill is to provide for job creation and economic incentives. The bill makes findings and states its purpose. The bill creates the Tax and Economic Incentives Review Committee, and establishes who may serve on that committee. The bill establishes the committee’s powers. The bill provides for the review of all tax and economic incentives every five years. The bill provides guidelines for the review of incentives. The bill requires reports, define terms.
The stated purpose of this bill is somewhat at odds with what the bill would actually accomplish. Ultimately, all it does is create a committee that is required to issue a report to the Legislature.
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov