West Virginia proposes AI data-center revenue plan to phase out personal income tax

Governor Patrick Morrisey released a comprehensive seven-point plan aimed at using AI data-center investments to abolish West Virginia's personal income tax over time. Under the scheme, half of the proceeds from approved hyperscale facilities would be devoted to tax reduction, with the other half distributed to counties—30% for local schools and government, 10% shared statewide, and 10% earmarked for infrastructure such as public water systems.

The initiative builds on the 2025 High Impact Data Center Designation process and includes provisions to protect utility users from added costs, a concern in the Eastern Panhandle and other regions. Lawmakers like House Minority Leader Sean Hornbuckle have called for added local-control safeguards, while the governor emphasized statewide benefit and grid reliability through coordination with PJM. The plan arrives as West Virginia's income-tax rate has already fallen to a top marginal rate of 4.58% after recent cuts by former Governor Jim Justice and Morrisey himself. Supporters argue the strategy will attract billions in private investment, create high-paying jobs, and revitalize distressed areas while preserving the state's natural environment.