taxes

JESSE WRIGHT / WEST VIRGINIA PUBLIC BROADCASTING

The Justice family companies’ difficulties paying taxes over the years are well documented. But tax collectors haven’t been the only ones trying to recover debts from companies once operated by West Virginia Gov. Jim Justice and now in control of his family.

A review of court documents by the Ohio Valley ReSource found at least five cases in which judges ruled that Justice family companies failed to pay suppliers for goods or services. When compelled by courts to pay, the companies either refused or failed to meet agreed upon payments.


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A new study shows Kentucky’s business tax environment had the greatest improvement in the nation. The state ranked 23rd this year in the 2019 State Business Tax Climate Index published by the Tax Foundation, a 16 spot improvement over last year.

Kentucky went to a single rate individual and corporate income tax, eliminating some business tax credits. The state also expanded the sales tax base and began phasing out inventory tax credits, or taxes on inventory held in the state by businesses. Those changes went  into effect on July 1st. The annual State Business Tax Climate Index shows Kentucky adopted a revenue-positive tax reform, meaning the state should collect more from the changes. Senior policy analyst Jared Walczak said the Commonwealth is moving towards a more competitive tax code.

JESSE WRIGHT / WEST VIRGINIA PUBLIC BROADCASTING

A federal court has ordered the U.S. Marshal to collect more than $1 million owed by two coal companies controlled by the family of West Virginia Gov. Jim Justice.

The U.S. District Court for the Southern District of West Virginia issued the writ of execution Wednesday, giving the U.S. Marshal the go-ahead to tap into multiple bank accounts associated with two Justice family-controlled coal companies, Southern Coal Corporation and Kentucky Fuel Corporation.

Paper company WestRock CP LLC and Southern Coal Corp. have for years been fighting in court over a coal supply agreement for a paper mill in Florida. The parties had settled, but after making three payments, Southern Coal Corp. stopped. This year, a federal court awarded WestRock a settlement totaling just over $1 million.

Ashton Marra, WVPB

In October, 2016, NPR, Ohio Valley ReSource and its partners reported that West Virginia billionaire coal baron Jim Justice, who was running for governor as a Democrat, owned companies that owed roughly $15 million in overdue taxes and mine safety fines.

This week, Gov. Justice, who is now a Republican, made an announcement about those taxes.

“I think we can put to bed once and for all this tax issue that’s been looming around forever more,” Justice said at a Monday press conference. 


Anna Boiko-Weyrauch

West Virginia Gov. Jim Justice said money his family’s coal companies owe in West Virginia has been paid.

At a Monday news conference, West Virginia revenue officials said the obligations from Justice’s companies had been paid, including fines and taxes.

“The state is completely and totally satisfied with the resolution of these matters,” Revenue Secretary Dave Hardy said.

Justice didn’t say how much was owed and paid or whether the debt obligations were reduced as part of negotiations. He also noted it would likely be a few days before the liens were released by the county offices, making the settlement of the debts official.

More Americans will be writing a check to the IRS in April because their employers are not withholding enough from their paychecks following the new tax law, the Government Accountability Office says in a new report.

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Starting this week, Kentucky’s six percent sales tax now applies to a new set of services like automotive repairs, pet grooming, dry cleaning, gym memberships and landscaping.

The state legislature approved the tax increases in order to put more money towards public education and cut the state’s income tax for people and corporations.

But business owners affected by the tax hike say they’ve been unfairly targeted. One of them is Bill Rogers, who owns Parrot Cleaners, a dry cleaning shop in Louisville. A couple of years ago he made a big investment: two massive machines that help his shop run faster and cleaner.

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A decision Thursday from the U.S. Supreme Court could mean increased revenue for Kentucky. The ruling will allow states to collect sales taxes from online retailers.

Previous rulings limited a state’s ability to collect that revenue if the business didn’t have a physical presence in the state. Kentucky Center for Economic Policy Executive Director Jason Bailey said while there won’t be an immediate effect felt from the Supreme Court decision, it will eventually lead to more money for the commonwealth.

NPR

An analyst from the Tax Foundation said raising the state cigarette tax is the wrong approach to creating new revenue in Kentucky. The Kentucky House passed a 50 cent cigarette tax hike last week as part of a two-year budget bill.

The Tax Foundation said Kentucky’s 2009 cigarette tax increase provided an initial boost in revenue, followed by a significant decline in the following years. Morgan Scarboro with the Tax Foundation said cigarette tax revenues are a volatile and unreliable source of revenue.

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Kentucky won’t be feeling as much of the effect of the federal tax reform law as most other states. That’s partly because the commonwealth doesn’t combine the standard deduction and the personal exemption.

According to a report from the Tax Foundation, Kentuckians won’t see significant changes in their state tax filings. But they will see that some of the exemptions they’ve previously claimed are more limited now.

Senior Policy analyst with the Tax Foundation Jared Walczak said the federal tax law changes are pro-growth and give states a chance to reform their own codes to become more competitive.

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Republican leaders of the General Assembly are throwing water on the idea that they’ll make major changes to the state’s tax code during the upcoming legislative session.

Lawmakers have to craft a new two-year budget for the state and are hoping to overhaul the pension systems in the session, which lasts from Jan. 2 until mid-April.

And for the first time in Kentucky history, Republicans will have control of the House, Senate and governorship during a budget-writing session.

NPR

Less than 12 hours after the Republican-led Senate passed its version of tax overhaul legislation, Senate Majority Leader Mitch McConnell was back in his hometown addressing the press.

McConnell held a brief press conference at the Galt House in Louisville Saturday afternoon, during which he rebuffed criticism that the bill favors the wealthy.

Updated at 3:10 p.m. ET

House Republicans unveiled a draft tax bill on Thursday, calling for deep cuts in both individual and corporate tax rates.

"With this bill, we will grow our economy by delivering more jobs, fairer taxes, and bigger paychecks to Americans of all walks of life," said Rep. Kevin Brady, R-Texas, chairman of the House Ways and Means Committee.

The Tax Foundation Business Tax Climate Index

A new report from the Tax Foundation ranks Kentucky’s Business tax climate 33rd in the nation. The foundation hopes the report will serve as a guide while both the state and federal governments consider tax reform.

The Business Tax Climate Index examines how competitive a state’s tax code is, and how well it encourages businesses to locate in that state.

“When we look at Kentucky, the reason the state ranks a little below average on our index, isn’t, say, the corporate income tax rate. It is things like the fact that Kentucky has an inventory tax," said Jared Walczak, lead author of the report.

The Kentucky Chamber of Commerce is urging U.S. Senator Rand Paul of Bowling Green to support passage of the federal budget.

In a letter to Sen. Paul, the Chamber advocated lowering the corporate tax rate and simplifying the tax code. Spokesperson Kate Shanks said they wanted to make it clear that the business community supports making these steps toward tax reform, and the chamber is hoping the Bowling Green Republican will join them in those efforts.

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