Published: July 08, 2008 10:39 pm      

Republicans seek total end to food tax

Manchin wants any further reductions done in ‘responsible way'

Gov. Joe Manchin is taking a cautious approach to any further drop in West Virginia’s food tax but a Republican leader in the House of Delegates says a push is coming next winter for elimination of the remaining 3 percent.

As of July 1, consumers began paying 1 percent less in taxes at the market, reflecting the Manchin administration’s incremental method of cutting it since Manchin came to power in 2005.

“At this point, it’s hard to say exactly when we’ll be able to propose an additional reduction,” Lara Ramsburg, communications director for Manchin, said Tuesday.

“Certainly, our goal is to continue to reduce the tax. But we want to do it in a responsible way and every penny that we reduce it is $25 million to our base budget.”

House Minority Leader Tim Armstead, R-Kanawha, says the state can afford to fully drop the 3 percent tax on groceries, given its recent history of racking up end-of-year surpluses ranging from $200 million to $300 million.

“Instead of giving that back to the taxpayers, the leadership and governor continue to spend that money,” Armstead said.

Even if the surpluses begin to diminish, he said, legislators and the governor simply need to set budget priorities based on revenues coming in with an eye toward easing the tax burden on West Virginians.

“We think the tax really hurts the people who can least afford it in a lot of ways,” Armstead said.

“Secondly, it’s a horrible tax for our border counties that are competing against states in which we’re out of sync with the taxes the other states are charging.”

Armstead said he cannot perceive that tax collections are going to be lowered dramatically, meaning the state will remain in a position to provide tax relief.

“Any time you do a tax reduction, I think it’s the one thing that’s been shown throughout the country to increase your revenues, increase the tax base,” he said.

“It helps creates jobs in the state and creates a larger tax base. It would not only help the individual but also help businesses.”

Since this is a gubernatorial election year, lawmakers will not begin the 2009 session until February, one month later than normal.

Ramsburg said the administration has managed to cut the food tax and others, while dealing with long-term debt “and still keep our budget in relative good shape, compared to other states that are really struggling right now.”

“Because those other states are struggling and because of the economic downturn the country is facing, we want to be really careful before we make any additional decisions on reductions,” she said.

“We can’t be sure right now that we can sustain it. The worse thing we can do is cut a tax because it sounds good and not be able to sustain it as we’ve done in the past.”

Armstead said the GOP in the House will continue to push, as it has done in recent sessions, for a full elimination of the food tax.

But Ramsburg pointed out the shortsightedness of doing that several years ago when the tax was scratched, then revived at double the rate when the state’s finances weakened.

“We can’t say right now what the timetable is going to be for any further reductions until we see where this economy goes and until we make sure we can sustain whatever additional cuts we would make,” she added.