Bill review: WV SB392 — Personal Income Tax Reduction

[DTrim99]

Bill Review: Personal Income Tax Reduction

Reform ID: wv-sb392 | State: WV
Bill text: https://www.wvlegislature.gov/Bill_Text_HTML/2026_SESSIONS/RS/bills/sb392%20intr.htm
Description: Reduces West Virginia personal income tax rates across all five brackets by approximately 10%, effective January 1, 2026. The bill lowers rates from 2.22%-4.82% to 2.00%-4.34%.

Merging this PR will publish the bill to the dashboard.

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What we model

Provision	Parameter	Current	Proposed
Bracket 1 ($0-$10,000)	gov.states.wv.tax.income.rates.*.brackets[0].rate	2.22%	2.00%
Bracket 2 ($10,001-$25,000)	gov.states.wv.tax.income.rates.*.brackets[1].rate	2.96%	2.66%
Bracket 3 ($25,001-$40,000)	gov.states.wv.tax.income.rates.*.brackets[2].rate	3.33%	3.00%
Bracket 4 ($40,001-$60,000)	gov.states.wv.tax.income.rates.*.brackets[3].rate	4.44%	4.00%
Bracket 5 (Over $60,000)	gov.states.wv.tax.income.rates.*.brackets[4].rate	4.82%	4.34%

Note: * represents all filing statuses (single, joint, head, separate, surviving_spouse)

Validation

External estimates

Source	Estimate	Period	Link
WV Governor/Senate	~$250M	Annual	Herald Star
WV Center on Budget & Policy	~$250M	Annual	WVCBP

Back-of-envelope check

WV PIT revenue $2.5B annually
10% reduction: 0.10 × $2.5B = **$250M**
(Aligns well with official estimates)

PE vs External comparison

Source	Estimate	vs PE	Difference
PE (PolicyEngine)	-$283M	—	—
Official estimate	-$250M	+13.2%	Acceptable
Back-of-envelope	-$250M	+13.2%	Acceptable

Verdict: PE estimate is within acceptable range (+13%). Difference likely due to PE using CPS microdata vs state administrative tax return data, and different income projections for 2026.

Parameter changes

Parameter	Period	Value	Bill Reference
gov.states.wv.tax.income.rates.*.brackets[0].rate	2026-01-01 onwards	0.02 (2.00%)	New rate schedule
gov.states.wv.tax.income.rates.*.brackets[1].rate	2026-01-01 onwards	0.0266 (2.66%)	New rate schedule
gov.states.wv.tax.income.rates.*.brackets[2].rate	2026-01-01 onwards	0.03 (3.00%)	New rate schedule
gov.states.wv.tax.income.rates.*.brackets[3].rate	2026-01-01 onwards	0.04 (4.00%)	New rate schedule
gov.states.wv.tax.income.rates.*.brackets[4].rate	2026-01-01 onwards	0.0434 (4.34%)	New rate schedule

Key results

Metric	Value
Revenue impact	-$282,957,643
Poverty rate	21.41% → 21.40% (-0.02%)
Child poverty rate	16.13% → 16.13% (minimal change)
Winners	62.6%
Losers	0.0%

Decile impact

Decile	Relative Change	Avg Benefit
1	0.07%	$9
2	0.14%	$44
3	0.20%	$94
4	0.22%	$134
5	0.27%	$191
6	0.27%	$226
7	0.33%	$328
8	0.34%	$398
9	0.47%	$693
10	0.84%	$3,723

District impacts

District	Avg Benefit	Winners	Losers	Poverty Change
WV-1	$402	61%	0%	0.00%
WV-2	$456	64%	0%	-0.04%

Reform parameters JSON

{
  "gov.states.wv.tax.income.rates.single.brackets[0].rate": {"2026-01-01.2100-12-31": 0.02},
  "gov.states.wv.tax.income.rates.single.brackets[1].rate": {"2026-01-01.2100-12-31": 0.0266},
  "gov.states.wv.tax.income.rates.single.brackets[2].rate": {"2026-01-01.2100-12-31": 0.03},
  "gov.states.wv.tax.income.rates.single.brackets[3].rate": {"2026-01-01.2100-12-31": 0.04},
  "gov.states.wv.tax.income.rates.single.brackets[4].rate": {"2026-01-01.2100-12-31": 0.0434},
  "gov.states.wv.tax.income.rates.joint.brackets[0].rate": {"2026-01-01.2100-12-31": 0.02},
  "gov.states.wv.tax.income.rates.joint.brackets[1].rate": {"2026-01-01.2100-12-31": 0.0266},
  "gov.states.wv.tax.income.rates.joint.brackets[2].rate": {"2026-01-01.2100-12-31": 0.03},
  "gov.states.wv.tax.income.rates.joint.brackets[3].rate": {"2026-01-01.2100-12-31": 0.04},
  "gov.states.wv.tax.income.rates.joint.brackets[4].rate": {"2026-01-01.2100-12-31": 0.0434},
  "gov.states.wv.tax.income.rates.head.brackets[0].rate": {"2026-01-01.2100-12-31": 0.02},
  "gov.states.wv.tax.income.rates.head.brackets[1].rate": {"2026-01-01.2100-12-31": 0.0266},
  "gov.states.wv.tax.income.rates.head.brackets[2].rate": {"2026-01-01.2100-12-31": 0.03},
  "gov.states.wv.tax.income.rates.head.brackets[3].rate": {"2026-01-01.2100-12-31": 0.04},
  "gov.states.wv.tax.income.rates.head.brackets[4].rate": {"2026-01-01.2100-12-31": 0.0434},
  "gov.states.wv.tax.income.rates.separate.brackets[0].rate": {"2026-01-01.2100-12-31": 0.02},
  "gov.states.wv.tax.income.rates.separate.brackets[1].rate": {"2026-01-01.2100-12-31": 0.0266},
  "gov.states.wv.tax.income.rates.separate.brackets[2].rate": {"2026-01-01.2100-12-31": 0.03},
  "gov.states.wv.tax.income.rates.separate.brackets[3].rate": {"2026-01-01.2100-12-31": 0.04},
  "gov.states.wv.tax.income.rates.separate.brackets[4].rate": {"2026-01-01.2100-12-31": 0.0434},
  "gov.states.wv.tax.income.rates.surviving_spouse.brackets[0].rate": {"2026-01-01.2100-12-31": 0.02},
  "gov.states.wv.tax.income.rates.surviving_spouse.brackets[1].rate": {"2026-01-01.2100-12-31": 0.0266},
  "gov.states.wv.tax.income.rates.surviving_spouse.brackets[2].rate": {"2026-01-01.2100-12-31": 0.03},
  "gov.states.wv.tax.income.rates.surviving_spouse.brackets[3].rate": {"2026-01-01.2100-12-31": 0.04},
  "gov.states.wv.tax.income.rates.surviving_spouse.brackets[4].rate": {"2026-01-01.2100-12-31": 0.0434}
}

Versions

• PolicyEngine US: 1.497.0
• Dataset: policyengine-us-data 1.48.0
• Computed: 2026-02-17