Americans for Tax Reform President Grover Norquist, right, encouraged West Virginia to join the eight states that have no personal income tax during Monday’s tax cut roundtable discussion at the Culture Centerin Charleston. (Photo courtesy of the WV Governor's Office)

CHARLESTON — With two competing plans to provide tax relief to West Virginians before the Legislature, Gov. Jim Justice brought two national conservative tax reform advocates to the state.

Justice held a tax reform roundtable Monday at the Culture Center on the grounds of the State Capitol Complex with Grover Norquist, president of Americans for Tax Reform, and Stephen Moore, distinguished fellow in economics at The Heritage Foundation.

“At the end of the day, what we want to do is one thing, that is simply make things better for the average, everyday, working West Virginian and absolutely drive growth to our state,” Justice said. “We have two individuals here who came voluntarily and came really and truly to give us insight and information on things we may well not know. Grover Norquist and Stephen Moore are absolute icons.”

Norquist founded Americans for Tax Reform in 1985 and is famous for its Taxpayer Protection Pledge, where the organization encourages local, state, and federal elected officials to pledge to oppose net tax increases. He is famous for wanting to reduce the size of the government “to the size where we can drown it in a bathtub.”

According to Americans for Tax Reform, eight states have no personal income tax and 11 states have flat income-tax rates, including neighboring Pennsylvania and Kentucky, which plan to reduce personal income tax rates by .5% each year when specific triggers are met until the tax rate goes to zero.”

State Senate President Craig Blair explained the tax cut plan passed by the Senate last week during Monday’s tax cut roundtable discussion. (Photo courtesy of the WV Governor's Office)

“One of the big advantages of getting to zero is it is very difficult, almost impossible, to go from zero to a higher number,” Norquist said. “If you’re at zero or going to zero, then businesses run at their best, young people decide to stay in the state. The income tax coming back is unlikely.

“Single-rate taxes are very helpful because when you want to cut taxes, everybody benefits,” Norquist continued. “If some jerk decides to increase taxes, he has to increase everybody’s taxes at once.”

Moore has been with the conservative Heritage Foundation since 2014 and advised former president Donald Trump on tax policy. He is a former member of the Wall Street Journal’s editorial board and co-founded the Club for Growth in 1999, a conservative political advocacy organization that raises money to elect Republican candidates for office. Trump nominated Moore for the Federal Reserve Board, but withdrew his nomination after criticism.

“My message to you, the governor, and everybody on this stage, is go big or go home,” Moore said. “I know the governor’s proposal is a 50% reduction in the income tax. I fully support that, but governor, I’m for a 100% reduction in the income tax. I’m fully in favor of your state getting to zero, because that would be a flashing billboard to the country, to entrepreneurs, to business, and to workers that West Virginia is open for business.”

Justice proposed, and the House of Delegates passed, a bill to cut the personal income tax by 50%, beginning with 30% for the current tax year, another 10% in tax year 2024 and another 10% by tax year 2025. The bill also includes a $700 million fund to cover any potential economic downturns that could affect the reduced tax income. The plan would return more than $1.4 billion to taxpayers when fully implemented.

Justice was joined on stage by cabinet secretaries, representatives of small and large businesses, higher education officials and leaders of two state conservative advocacy organizations, the West Virginia chapter of Americans for Prosperity and the Cardinal Institute for West Virginia Policy. Justice also was joined by the leaders of the state Senate and House of Delegates.

“We are very proud of where we are as a state, and we are very proud of where we have come,” said House Speaker Roger Hanshaw, R-Clay. “We are excited to reduce the aggregate tax burden on taxpayers in West Virginia. We absolutely share the belief that what we need here are workers, what we need here are taxpayers, what we need here are consumers and customers to frequent businesses and send children to the schools and provide a workforce for businesses.”

Senate President Craig Blair, R-Berkeley, used his time Monday to explain the Senate’s counterproposal to Justice’s tax cut plan which would return more than $600 million to taxpayers.

“This has set the stage that we’re wanting to do it and we’re wanting to work together,” Blair said. “We’re trying to thread the needle and make it so it works for everybody and be successful.”

Senate Bill 424 includes a 15% personal income tax rate beginning in tax year 2024. The plan includes triggers to further phase out the personal income tax tied to increases in consumer sales and use tax revenue beginning in 2025.

“By phasing it in and having those triggers in the sales tax, we believe in the Senate that it puts it in place in such a way that it’s prudent,” Blair said. “That number of $600 million. We know that’s a real number we can work with and be able to hopefully, aggressively, recruit more businesses into the state. The more people you have in the workforce and paying tax, it will accelerate the reduction of the personal income tax.

The plan includes a full rebate in the form of a personal income tax credit to taxpayers for the payment of tangible personal property taxes on motor vehicles. It also includes a 50% tax rebate and personal income tax credit for the payment by small businesses on tangible personal property taxes on machinery/equipment, inventory, leasehold investments, computer equipment and furniture and fixtures effective Jan. 1, 2024.

Additionally, SB 424 would also eliminate the so-called “marriage penalty” for tax filers and a homestead real property tax exemption for military veterans who are 90% to 100% service-disabled. Blair said the governor’s plan isn’t financially sustainable for the state and also doesn’t benefit low-income workers and seniors beneath a certain income threshold who pay no income taxes.

Justice was optimistic that a deal on tax reform can be struck between himself and the Legislature before midnight on March 11 when the 2023 legislative session ends.

“We’ve got to all work together,” Justice said. “I’m a true, true believer with all in me that we had to have real life ideas on the table. We have to all continue to work together, because whether it be the House, the Senate or the governor, at the end of the day we’ll stay on a pathway and check our feelings and emotions at the door and get to work on what’s good for you.”

Monday’s roundtable discussion was well attended, including by a number of public employees of the State Tax Department who were shuttled from their offices in downtown Charleston to the Culture Center to watch the discussion despite the political nature of the event.

“The modern Republican party will not raise your taxes,” Norquist said. “This is a particularly important political decision as well. If you want to protect the progress that has been made in this state to become a red state, continuing to make the Republican Party the party that will never raise taxes and bring them down changes the politics of the nation and changes the politics of the state. But do it because it is good for the economy.”

In a statement, Justice spokesperson Jordan Damron said Department of Revenue Secretary Dave Hardy invited State Tax Department employees and it was not mandatory to attend.

“Secretary Hardy asked the Tax Commissioner (Matt Irby) to invite his employees from the Tax Department to attend to hear from the tax experts,” Damron said. “It was an open invitation and they were not forced to attend.”

Steven Allen Adams can be reached at sadams@newsandsentinel.com.