Virginia’s recent flirtation with higher taxes and tighter regulation has opened a political and economic fight with neighboring West Virginia, where Gov. Patrick Morrisey is aggressively courting businesses and workers across the border. Morrisey is promoting new commercial districts, tax cuts and a low-regulation pitch aimed at Loudoun County and other Virginia communities, while Virginia’s governor pushes her own affordability-focused agenda. Lawmakers in West Virginia have created a toolset to redirect revenue into special tax districts to fund development, and officials say new private investment and job claims back up the strategy.
Morrisey has put the Eastern Panhandle at the center of his effort to pull commerce away from Virginia, unveiling a 275-acre commercial tax district he says will attract about $200 million in private investment. He plans to take that message directly into communities like Loudoun County, comparing West Virginia’s lighter tax and regulatory load with Virginia’s proposed changes. “We’re going to be spending some time in Loudoun County and all across Virginia on making the pitch and the comparison of the direction that West Virginia is moving in [and] the direction Virginia is going in,” Morrisey said on the sidelines of the announcement.
“The backyard brawl for our state’s future is being won both at the kitchen table and in the marketplace,” Morrisey added, framing economic competition as both personal and practical. The Tabler Station area hosts a strong apple industry, where local identity even shows up in the high school nickname, the Musselman Applemen, and it also hosts big industrial employers including a major Clorox plant advertising job openings along I-81. Those visible employers and local identity give West Virginia a tangible basis for the governor’s pitch to businesses looking for lower-cost locations.
Morrisey has been blunt in his contrast between the two states. “While Virginia chooses to burden its citizens and job creators with higher taxes, West Virginia is choosing freedom, fiscal responsibility, and a tax climate that makes our state more competitive for business than our neighbor.” That message plays to voters and business owners who put taxes and regulation at the top of their cost concerns, and it’s the theme driving the state’s outreach across the border.
With a Republican supermajority in Charleston, Morrisey and his allies are positioning West Virginia as “open for business” statewide, and they want border counties to be showpieces. Berkeley and Jefferson counties, which share a border with Loudoun County and parts of Maryland, are being highlighted as models for regional tourism and business growth built on accessible tax incentives and public investment. Officials say the new districts will help fund youth sports and travel destinations to increase local visibility and revenue streams.
The governor also pointed to population shifts from the Washington, D.C., area into the Eastern Panhandle, even with long commutes and limited rail service, as evidence that people will choose lower-cost living when the incentives align. “The difference between Virginia and West Virginia couldn’t be more clear,” he said, underscoring the idea that tax policy and regulatory posture are decisive. Local Republican Sen. Jason Barrett, R-Martinsburg, who pushed the new economic development framework, says residents are already spending more in border towns and helping local businesses thrive.
Barrett’s new law sets up a framework for special tax districts where a portion of state revenues can be redirected to counties, a move the legislature can implement because tax structure changes require legislative action. The law includes guardrails, stipulating that redirected taxes may not “adversely effect” the state budget, and it expands districts into places like Harpers Ferry, Henderson, Bridgeport, Princeton, Beckley and Wheeling. Lawmakers expect the districts to seed projects that attract more visitors and youth tournaments while leveraging private investment.
On the fiscal front, Morrisey signed a 5% across-the-board income tax cut in April and adjusted Charleston’s tax code to sit closer to the federal tax-cut provisions championed by President Donald Trump. State officials claim those moves, combined with population growth and rising revenues, have enabled this push for broader tax relief. Morrisey projects that statewide private-sector investment reached $12.5 billion and that roughly 12,000 new jobs have been added in the past six months amid the broader rollout of these policies.
Virginia’s governor has pushed back with her own outreach, announcing an economic development tour and promising economic policies she says will help families and businesses. She said in a statement that “from day one, my focus has been building an economy that works for every Virginian and delivers real results for families, businesses, and communities.” Her administration notes it did not sign several proposed tax measures that never reached her desk, even as it approved a minimum wage increase and higher payroll contributions for family leave.
As West Virginia leans into tax cuts and targeted development districts while Virginia debates new taxes and regulations, both governors are taking their cases directly to voters and businesses. The policy battle has become a state-lines contest, with each side promoting its model for growth and expecting the marketplace to pass judgment through investment and migration choices.
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