West Virginia governor says budget, tax deal is close
West Virginia’s Democratic Gov. Jim Justice said Saturday night that he’s near a deal with the Senate Republican leadership to limit budget cuts to about $50 million while raising the sales tax 1 percent and cutting the income tax.
The tentative agreement, which has smaller cuts than the Senate and House were advancing, protects public schools, higher education and services for the state’s poorest residents, Justice said. It would raise the state sales tax from 6 percent to 7 percent, add a corporate revenues tax of 0.00045 percent and in 2018 establish new income tax tiers cutting the current rate 20 percent, he said.
"We’re not there yet, but we’re close," Justice said as the 60-day legislative session headed toward its close. The Senate followed by the House could approve the needed legislation Saturday night or Sunday, he said.
It would increase the state gasoline tax by 4.5 cents a gallon and start his proposed road reconstruction program aimed at creating thousands of jobs.
It also includes his proposal for a 2 percent pay raise for teachers and "a rich man’s tax" that would impose small additional taxes on the state’s wealthiest residents.
The Senate and House had each initially voted this week for budgets with far steeper cuts to balance a budget deficit projected at nearly $500 million in the fiscal year that starts July 1.
The Senate also advanced a tax overhaul that would broaden and raise the sales tax while cutting the income tax, aimed at eventually eliminating it.
The House advanced a budget with lesser cuts and a bill expanding the sales tax to cover cell phone and non-medical personal services then reduce the sales tax next year to 5.5 percent.
Both chambers were still in session shortly before midnight Saturday and trying to wrap up various pieces of legislation for the year.