While the West Virginia Senate passed a bill that would raise the state’s tobacco tax rate on cigars and other tobacco products from 12 percent to 50 percent of the wholesale rate, it won’t be advancing further through the legislation process after another piece of legislation failed to get the needed number of votes.
That piece of legislation, Senate Joint Resolution 9, needed to get 23 votes from the Senate to pass, though it managed to get only 18, with 16 members opposing it. It would have sent a question to voters in November asking if they wanted to amend the state’s constitution for allow for changes to property taxes, specifically reducing them and implementing a gradual phase out of personal property taxes on manufacturing machinery, equipment, automobiles and inventory.
To make up for the decrease in revenues from those areas, legislators introduced SB 837, which raised the tobacco tax, as well as the cigarette tax from $1.20 to $2 per pack. It would have also subjected e-cigarettes and vaping products to the 50 percent rate, a change from the current rate of 7.5 cents per milliliter.
The proposal also called for an increase the state’s sales tax from 6 to 6.5 percent. Supporters of the change positioned it as a simple shifting of where taxes were being paid, but critics of the proposals said that it created a $100 million deficit that would be put on the shoulders of the state’s residents, many of whom are struggling economically as it is.
Had SJR 9 and the tax increase bill advanced and gone into effect, it would have meant that a cigar with an MSRP of $9.50 go from $10.64 to $14.25 by halfwheel estimates, and before any sales taxes are added.