Food tax cut means savings

CHARLESTON — The state shaved another 1 percent off the sales tax on groceries July 1, leaving on 1 percent left to charge on food.

[cleeng_content id="118326772" description="Read it now!" price="0.15"]The food tax was originally 6 percent prior to 2005, according to the West Virginia State Tax Department.
Under the leadership of then-Gov. Joe Manchin, the state Legislature decreased the food tax from 6 percent to 3 percent by July 1, 2008.
Gov. Earl Ray Tomblin proposed continuing cuts to the food tax that began under his predecessor.
The 3 percent reduction saved a typical family about $196 a year, according to the Bureau of Statistics.
Revenue officials estimate the latest 1 percent cut will save consumers $26 million a year.
That means the state will lose $26 million in revenue.
The biggest benefit of the tax reduction on food will go to the retailers as the decrease will mean fewer shoppers will cross the borders to pay less money for food.
Kentucky’s food tax is 6 percent. Virginia has a 2.5 percent charge on food.
Retailers near those border states should see an increase in food purchases, according to the West Virginia Oil marketers and Grocers Association.
The tax will disappear completely after July 1, 2013, if emergency reserves remain sufficient.
Emergency reserves or the rainy day contingency fund is equal to or greater than 12.5 percent of the state’s general revenue fund.[/cleeng_content]

 

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