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House Committee Refuses Another Tax Bill

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Perry Bennett
/
West Virginia Legislative Photography

A bill that would reduce the state’s severance tax on coal and natural gas from 5 percent to 3 percent has been postponed in the House.

Senate Bill 705 was taken off the table for lawmakers this session and instead was turned into an interim study measure during a House Finance Committee meeting Wednesday.  That would give the legislature time to study the effects of the tax cut in more detail during the months between legislative sessions.

The bill passed quickly through the Senate, but with some debate. Some argue the proposed 2 percent cut over two years would help aid a struggling industry, while others say the bill would simply mean government-funded services in coal-producing counties would shoulder the cuts.

House Finance Chairman, Eric Nelson, says lawmakers need more time to consider a bill that would decrease state revenue, especially in a tight fiscal year.

“These taxes, according to that bill, would not have been dropped until fiscal year 2018, so it would have been July 2017," Nelson said. "What a study does is, it puts much greater emphasis on addressing potentially reducing this tax, helping these industries out, and we can look at that over the next 8 months. Then, at the beginning of next session, then, we are handling a tax reduction that can potentially help some industries. Instead of hitting this in the last few days of this session and rushing into something we will second guess later.”

Lawmakers did approve another measure to cut some taxes for the coal and natural gas industries this session. The bill got rid of a surcharge on the resources that was helping to pay off the state’s Worker’s Compensation Debt. That bill was already signed by Governor Tomblin.

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