As of today, the 1-cent beverage tax, commonly known as the “pop tax,” is officially off the books in West Virginia. State lawmakers decided to eliminate this tax during the 2022 regular legislative session, putting an end to its $14 million annual revenue stream.
Initially enacted in 1951, the pop tax was designed to fund the construction of the WVU Medical School in Morgantown. Although the school has long since been built, the tax remained in place, providing a steady source of income for WVU.
State Revenue Secretary Larry Pack acknowledged the challenge in removing such a longstanding tax. “It’s really hard to get a tax off,” he said. “Every once in a while, the taxpayers get a win, and this is a win for the taxpayers of West Virginia.”
Despite the elimination of the pop tax, WVU will still receive its $14 million in funding. Lawmakers devised a plan to continue this funding through the state Insurance Premium Tax. This tax will now allocate $14 million to WVU health sciences, $5.5 million to the Marshall University Joan C. Edwards School of Medicine, and $3.9 million to the Osteopathic School of Medicine. Previously, these funds were directed to the state’s general revenue account.
- Politicians in West Virginia respond to the first presidential debate
- After determining eligibility, Medicaid in West Virginia is shutting down, leaving 254K behind
- Residents of West Virginia Get Ready for Possibly Tornadoes and Active Weather
Rob Alsop, then Vice President of WVU, expressed his satisfaction with the new funding arrangement. He noted that the replacement revenue “helps get us comfortable and achieves their objective.” The Insurance Premium Tax will now constitute approximately 40% of WVU’s state funding for its health sciences programs. Notably, this marks the first instance of dedicated funding for Marshall and WVSOM.
The West Virginia Beverage Association has welcomed the repeal of the tax. General Counsel Will Swann stated, “Repealing the beverage tax is a win for West Virginia’s working families, small businesses, and the state economy. This tax unfairly raised prices on hundreds of everyday beverages for 71 years.”
The beverage tax also incurred administrative costs for companies like Coca-Cola Consolidated, PepsiCo, Keurig Dr Pepper, and ABARTA Coca-Cola, who had to manage tax stamps and crowns on their products. Swann noted that removing the tax enhances the competitiveness of West Virginia beverage companies, as neighboring states do not have such a tax, leaving Arkansas as the only state with a similar levy.
The repeal has already spurred approximately $32 million in new investments in West Virginia, including new PepsiCo facilities in Ona and Teays Valley. Pack and Swann both praised state Tax Commissioner Matt Irby and his team for their efforts in navigating the tax removal process.
Pack highlighted the longstanding desire to remove the tax, which had been discussed in the statehouse for decades. “That was a goal of a lot of previous legislators and previous governors, but Gov. Justice and this current legislature finally got it done, and they all should be congratulated,” Pack said.
The precise impact of the tax removal on beverage prices remains to be seen. The process for collecting and submitting the tax to the state has ended, resulting in the cessation of the $14 million annual revenue previously generated by the tax.
Joeal Bright is a committed journalist at WVPrepBB.com, focusing on USA and crime news. With a knack for in-depth reporting and a dedication to delivering accurate and timely information, Joeal keeps readers informed about crucial national events and crime stories. His work on WVPrepBB.com is essential for those seeking comprehensive coverage and insightful analysis of current events in the United States.
