Dropping business franchise tax, increasing minimum wage among W.Va. laws effective Thursday

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CHARLESTON, West Virginia — Starting Thursday, West Virginia's lowest-paid workers will get a raise and businesses will have one less state tax to pay.

West Virginia is increasing its minimum wage and nixing its business franchise tax, two of the laws effective New Year's Day.

For operators of aboveground storage tanks, Thursday is also the due date for inspection certifications under a new law to safeguard water supplies and prevent chemical spills.

Here are some specifics:

— For several years, West Virginia has decreased its business franchise tax under a plan approved by former Democratic Gov. Joe Manchin, now a U.S. senator. On Thursday, the state will drop the tax altogether.

In 2009, the tax rate was reduced to 0.48 percent of a company's capital accumulation and stock value. The 2014 rate has dwindled to 0.1 percent, or 10 cents per $100 of taxable capital.

The tax started in 1987 at 0.55 percent and grew to 0.75 percent in 1989, said Democratic Gov. Earl Ray Tomblin spokesman Chris Stadelman.

Tomblin has said the tax made it difficult for West Virginia to compete for new and expanding businesses.

In recent difficult budget years, however, revenues have dropped from the gradually cut tax. At one point, the tax brought in more than $100 million annually, Stadelman said.

— West Virginia's minimum wage is set to increase by 75 cents to $8 per hour, the state's first minimum wage boost since 2008.

The mark is set to increase again in January 2016 to $8.75.

The legislation revises maximum hour and overtime compensation standards. Workers dependent on tips will also get a pay bump, from the current $2.13 per hour to $2.40 in 2015 and $2.63 in 2016, the West Virginia Center on Budget & Policy calculated.

The Economic Policy Institute estimates 88,000 West Virginians will get a raise because of Thursday's wage change.

The federal minimum wage is $7.25 an hour.

The state law passed with bipartisan support. Groups like the National Federation of Independent Business opposed an increase, saying it would drive up labor costs on cash-strapped small businesses and stifle hiring.

— New, annual aboveground tank inspection certifications are also due. Department of Environmental Protection spokeswoman Kelley Gillenwater says the state received about 22,000 of them by mid-day Wednesday, fewer than half of the tanks that require inspections.

Gillenwater said tanks without inspections by Jan. 2 will be out of compliance, but the department will work with operators on the requirement.

The annual inspections are included in a law reacting to a January chemical spill. The leak from a Freedom Industries tank in Charleston spurred a tap-water ban for 300,000 people for days.

The law sets up new a regulatory system for many tanks and also addresses emergency planning for public water systems.

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