In Fiscal Year (FY) 2011, West Virginia collected $7 billion in state and local taxes. While this is an impressive sum of money, it tells us little about whether or not the average West Virginia taxpayer can afford this level of taxation.
As shown in the charts below, West Virginia’s state and local tax burden (tax collections divided by personal income) was the ninth highest in the nation for FY 2011 at 11.5 percent—or 9.6 percent above the national average of 10.5 percent. Not surprisingly, West Virginia’s tax burden has grown significantly over time by 76 percent to 11.5 percent in FY 2011 from 6.5 percent in FY 1950.
West Virginia’s high tax burden is driven by a high individual income tax burden (2.7 percent, 14th highest), a high corporate income tax burden (0.51 percent, 9th highest), and high all other tax burdens (3.9 percent, 6th highest)—all other taxes being primarily severance taxes on natural resources, especially coal.
J. Scott Moody has nearly 20 years experience as a public policy economist with a specialty in tax policy and has over 180 publications. He has worked for numerous national and state-based think tanks such as the American Conservative Union Foundation, Federalism In Action, Tax Foundation, Heritage Foundation, and The Maine Heritage Policy Center.