Tax & Accounting Blog

West Virginia Mulls State Sales Tax Increase

Indirect Tax, ONESOURCE, Sales and Use Tax February 18, 2014

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This week, West Virginia House Delegate Jim Morgan introduced HB 4456, which would raise the state sales tax rate from 6.00% to 7.00%. This would make West Virginia’s State Sales tax rate tied for the highest rate in the nation along with Indiana, Mississippi, New Jersey, Rhode Island, and Tennessee. If the sales occur in the cities of Charleston, Harrisville, Huntington, Quinwood, Rupert, Wheeling, or Williamstown, the sales are also subject to a local sales tax rate ranging from 0.5% to 1.00%, bringing the total sales tax rates in those locations up to 8.00%.

While that additional 1.00% rate would hurt consumers, the combined rate of 8.00% would still put West Virginia below the average general local sales tax rates, and behind Tuba City, Arizona, which has the dubious honor of having the nation’s highest sales tax rate of 12.725% for sales to non-tribal members. That whopping 12.725% is a combination of Arizona’s 5.6% rate, Coconino County’s 1.125% rate, and a 6.00% rate levied by the To’Nanees’Dizi Local Government.

The West Virginia Legislature has also proposed alternatives for revenue raising, especially by local governments, including HB 2993. HB 2993, introduced by House Delegate John Shott, would allow counties and cities to impose a local meals tax of prepared foods served in a restaurant of up to 2.00%.