Newspaper article Charleston Gazette Mail

State Must Act to Remain Competitive ; Several States Have Reduced, Eliminated Taxes to Attract Business

Newspaper article Charleston Gazette Mail

State Must Act to Remain Competitive ; Several States Have Reduced, Eliminated Taxes to Attract Business

Article excerpt

Tax policy is of utmost importance for economic growth and prosperity.

For instance, one particular side effect of bad tax policy known as a tax inversion a process in which a U.S. company relocates its headquarters to take advantage of lower tax rates internationally has been a hot-button topic. In West Virginia, we have long seen companies and individuals move to other states to lower their tax burden. This type of regional tax inversion has had a devastating effect on the economy of our state over the years.

We can all name companies that were mainstays of our local economy that have moved just across the border for various reasons including tax, such as Appalachian Power and Mylan Pharmaceuticals.

According to the Tax Foundation, there are several states that do without one or more of the major taxes: the corporate tax, the individual income tax or the sales tax.

Wyoming, Nevada and South Dakota have no corporate or individual income tax. Alaska has no individual income or state-level sales tax. Florida has no individual income tax. New Hampshire and Montana have no sales tax.

Other states have moved their tax rates down in recent years. North Carolina has made huge improvements in its tax code in 2015, which will put added pressure on West Virginia as a regional competitor for entrepreneurs and corporate expansions.

The states largest improvement was in the individual income tax, where legislation restructured the previously multi-bracketed system with a top rate of 7.75 percent to a single- bracket system with a rate of 5.8 percent and a generous standard deduction of $7,500.

They are also planning further improvement next year as the rate is expected to decrease again to 5.75 percent.

The corporate income tax rate in North Carolina is also phasing down. The rate fell from 6.9 percent last year to 6 percent this year. …

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