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WV Legislature approves coal tax rebate program for new equipment, severance tax cut - Report

Coal News - Published on Thu, 14 Mar 2019

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The West Virginia Legislature passed a coal tax rebate program during the end of the 2019 session designed to boost production by making it easier to procure new equipment. The Legislature passed House Bill 3144, which creates North Central Appalachian Coal Severance Tax Rebate Act for capital investment on new machinery and equipment. In this legislation, any taxpayer who has experienced a change in business composition through merger, acquisition, split-up, spin-off or other ownership changes, or changes in the form of the business organization from limited liability company is eligible for the rebate on the condition they have been operating within West Virginia for two years prior to making said capital investments.

Sen. Randy Smith, R-Tucker, said that “They still have to pay their base tax. They have to meet their baseline from the previous year, the same severance tax as the year before, and then 20 percent of the new production and then anything above that they get the tax break on the equipment.” He said this is also meant to incentivize new producers. An example, he said, is Arch Coal, which plans to open a metallurgical coal mine in Barbour County that will produce 3 million tons of coking coal annually and employ 600 people.

Mr Smith said the timing of this and the North Central Appalachian Coal Severance Tax Rebate Act means Arch Coal and possibly others have the chance to take advantage. What’s more, he said this presents an opportunity for West Virginia to attract investors who might otherwise locate in the western United States. He said that “They (Arch Coal) could have easily gone to Wyoming.”

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Posted By : Rabi Wangkhem on Thu, 14 Mar 2019
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