The “Flat Tax: Stupid But Possibly Workable
Caleb Frigo (yipinstitute.org/article/the-flat-tax-good-idea)
Word leaked out recently that Governor Patrick Morrisey planned to call the Legislature into special session next week to eliminate West Virginia’s graduated income tax and replace it with a so-called “flat” income tax of 3.88%.
The idea of a special session was quickly nixed, as the 2026 Regular Session is scheduled to begin in about five weeks. Many legislators rebelled at being asked to consider something as complicated as a major tax change without sufficient notice.
The governor may try to push this idea in the Regular Session. It’s quite complicated.
A “graduated” income tax is structured so the higher one is on the income scale, the greater percentage of one’s income is paid. I think this fair. Under a “flat” income tax, everybody pays the same percentage. While I think this is still marginally fairer than the sales tax (whereby everybody, regardless of means, pays the same amount of money), it’s still regressive to me. It makes folks living on the margins pay a much greater amount of their disposable income in taxes than those with greater means.
But I think the flat tax can be made moderately more tolerable by including a significant basic exemption. For grins and as an example, I suggest we consider a tax rate of four percent with a $30,000 exemption.
This exemption would be a floor at which the tax percentage would start. With an exemption at $30,000 and a four percent tax, a person making $40,000 per year would pay four percent of only the $10,000 above the exemption. That person would be paying an income tax of only one percent of his or her total income, or $400. Without any exemption, that same person would be paying $1,200 per year. With that same exemption, one would have to reach $60,000 income to be paying $1,200 in tax.
With the $30,000 exemption, a person making exactly that amount of money would pay no income tax. Without that exemption, that same person would pay $1,200 per year.
Any combination of rate and exemption is theoretically possible. To be truly fair, the combination of rate and exemption should be whatever will cause every taxpayer to pay the first dollar only with disposable income. I define that as whatever money remains after paying for needed food, shelter, clothing and medical care. This goal will probably never be reached, but we should try to get as close as possible.
The purpose of taxation is to fund whatever government the law authorizes. We must not set the exemption so high as to cause a deficit.
Am I seeing a light at the end of a very dark tunnel here? The previous governor, Jim Justice, wanted to eliminate the income tax, and many Republicans in the Legislature went for that shiny object. The only practical way to eliminate the income tax would be to at least double our property taxes, and very few West Virginians want that.
Is Morrisey, realizing this, actually trying to save the income tax?
