Kingwood municipal sales tax will take effect July 1 if state approves

KINGWOOD — Kingwood is on track to become the first town in Preston County to begin charging a municipal sales tax, and city officials hope it will bring in at least $150,000 the first year.

Council  passed the ordinance, and now it awaits a final ruling from the state tax department. If it approves the town’s submission by Jan. 1, the tax will go into effect July 1.

Councilwoman Michelle Whetsell brought the idea to council and did all the paperwork and research required, working closely with the tax department. She estimates Kingwood could receive  from $150,000 up to $250,000.

Part of what she worked on with the tax department was  to get all addresses within the city’s zip code, plus four. That is what the state uses to figure out who is subject to the tax. It can be tricky, Whetsell said, and required extensive research.

“We had some, like Daisy [Street], one side of the road the house is in the city limits and the very next house next door is not in the city limits,” she said. “Those are the kind of things I had to look at very carefully.”

The state tax department has forms for people to request a refund, if they think they were improperly charged the tax.

Whetsell said she learned a lot about  the tax through the municipal league.

“Kingwood’s not getting more tax dollars,” she said. “We’re pretty stagnant. And with our budget, there’s things that we need, desperately need. We definitely need a street sweeper. And that’s what I was looking at, was how we could bring in a few more dollars and be able to provide for the citizens of Kingwood, necessary things.”

The money will go into the general fund, so  it can be used for anything council decides to use it on.

City Clerk Mary Howell noted there’s no way to make an accurate projection for the first year because the state will not tell towns how much sales tax local businesses pay.

Her recommendation to council will be not to budget any  of the tax receipts for 2019-‘20, which begins July 1, then do a budget revision based on the amount that comes in.

“And then the next year we will have a more accurate projection,” Howell said.

The tax will be one cent on the dollar for goods and services sold in town, including internet sales. There are some exemptions, such as gasoline and satellite TV service, and other transactions where federal law preempts local.

Businesses remit the tax to the state tax department, just like they do the state sales tax. The state sends towns a check for the tax, usually quarterly.

Currently 43 towns in West Virginia  collect the tax. None are in Preston or Monongalia. Grafton in Taylor County, Bridgeport and Clarksburg in Harrison County, and Fairmont and White Hall in Marion County are the closest.

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