FILE – West Virginia Gov. Jim Justice speaks at an election party at the Governor’s Mansion in Charleston, West Virginia, May 14, 2024. (AP Photo/Chris Jackson, File)

CHARLESTON, W.Va. (AP) — West Virginia residents will see a 4% cut in their income tax in the new year, Gov. Jim Justice said. The Republican governor announced Thursday that state revenues had met the threshold for the cut, which is set to take effect Jan. 1. The decision was confirmed by Treasurer Larry Pack and State Auditor J.B. McCuskey. The cut comes after Justice signed a 21.25% income tax cut last year. Under the 2023 law, additional state income tax cuts can be triggered by a formula that takes into account higher-than-expected annual tax revenues. Those additional tax cuts cannot be higher than 10%. Justice has stressed that he wants to see the income tax eliminated to spur economic growth in one of the nation’s poorest states, and he has repeatedly tried to persuade state lawmakers to cut the tax entirely. The 2023 law, which takes a more moderate approach, was a compromise between the state’s executive and legislative branches.
“Even if it won’t happen during my term as governor, our state is on track to eliminate its income tax – so let’s keep the ball rolling in the same direction,” Justice announced this in a statement on Thursday. “We all know that abolishing income tax will ultimately bring more good and more people to our beautiful state.”
Justice said last month he expects to cut the income tax by about 4% starting next year, but plans to call lawmakers back to the Capitol for a special session to consider another 5% cut. The governor has not yet called a special session or set tentative dates for lawmakers to return to the Capitol, so it’s unclear if that will happen. The West Virginia Center On Budget and Policy urged caution on further tax cuts, saying the income tax is the state’s largest source of revenue and years of stagnant budgets have left education and child care needs unmet.