‘It’s concerning,’ business owner reacts to personal state income tax elimination plans

Published: Apr. 6, 2021 at 11:44 PM EDT
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CHARLESTON, W.Va. (WSAZ) - There are three proposals on the table on how to eliminate the personal state income tax for West Virginians, but two of the three plans would involve a significant sales tax rate increase.

“It’s extremely concerning to me, any increase right now during a pandemic where restaurants and food service providers, like myself, have been asked to give so much,” said Jeni Burns-Riser, owner of Ms. Groovy’s Kitchen catering business in Kanawha City. “We’ve been shut down, we’ve been reduced to half capacity I mean, one day in 2019 I did three events totaling 800 people in one day. You’ve reduced me down (to) doing weddings for 20 people.”

Currently, the senate’s version of the bill would increase the sales tax rate by 2.5 percent, which would be in addition to the current 6 percent across the state.

“Every single dollar that you make is getting income tax pulled out of it,” said Republican Sen. Tom Takubo from Kanawha County. “What we are saying is we want to take a small increase in the sales tax, but most of what people spend their money on, their mortgage, medical bills, groceries, doesn’t get any tax pulled out of it.”

Lawmakers are hoping the personal state income tax elimination will attract more people and business to West Virginia to increase the state’s growth. However, Burns said she believes it will do the opposite for business owners like herself.

“It just wouldn’t be a motivator to stay, as a matter of fact, it would be a motivator to leave,” Burns told WSAZ. “I don’t have to be in Charleston, West Virginia to cater events in Charleston, West Virginia, I can be in Ironton, Ohio, Ashland, Kentucky.”

She said the fact that she’s in a business that can travel makes her fearful people will go out of state for caterers since the tax increase would raise her rates.

“Some of us have chosen to increase our cost per person because of all the PPE we’ve had to buy: masks, to-go boxes, all the take out equipment is expensive,” she said. “Then you’re adding an increase in sales tax, and the customer is only going to be willing to spend so much.”

The Senate is scheduled to set amendments and vote on their version of the bill during Wednesday’s session.

Currently, the House’s bill is the only plan that would not raise the sales tax rate; it would instead take from the state’s budget. This plan would take about 12 years to be in full effect.

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