State Revenue Continues Above Forecast

The state of West Virginia has collected over $128 million more than budgeted for the first six months of the current fiscal year, according to state officials. 

Cumulative General Revenue Fund collections of more than $2.742 billion are $128.1 million above the year-to-date estimate and 2.5% ahead of last year’s collections. This is despite December collections being more than $3 million below the $514.5 million monthly estimate. 

“I’m encouraged by the $128 million surplus halfway through this fiscal year and continuing growth in overall collections,” Gov. Patrick Morrisey said. “Sales tax revenue growth of 10.1% is particularly impressive in comparison with last year. Current trends bode well for the State as we prepare for the coming budget year.”

One of the biggest drivers of the excess revenue was personal income tax collections. Those taxes were nearly $47.9 million above the estimate and just slightly below last year, despite tax rate cuts and the subtraction of the recently enacted refundable motor vehicle tax credit. 

Year-to-date wage and salary withholding tax collections were 0.6% ahead of last year. Current tax rates are nearly 6% lower than tax rates in place one year ago.   

On Monday, Gov. Patrick Morrisey unveiled a legislative agenda that included additional tax cuts. 

Consumer Sales Tax collections totaled $175.5 million in December. That is 3.8% ahead of last year. Adjusted year-to-date collections were 5.7% ahead of prior year’s receipts.

December severance tax collections totaled $44.9 million. December receipts were $5.3 million above the monthly estimate and 11.6 percent ahead of prior December receipts. 

Year-to-date severance tax collections were $600,000 above estimate. 

A trend of higher coal production and higher natural gas production along with higher natural gas prices were largely responsible for the revenue gain to-date.

Corporation net income tax collections totaled $51.7 million in December and $155.2 million for the year-to-date. December collections were $8.4 million above estimate. Cumulative collections were $7 million above estimate and 12.7% below prior year receipts.

Tobacco tax collections were $3.4 million below estimate and 5.4% below prior year-to-date collections due to a trend of shifting consumption away from cigarettes to other tobacco and vaping products.

Interest income totaled $12.6 million in December and $78.7 million for the year-to-date. Cumulative collections were $18.2 million above the estimate and 28.2% below prior year’s receipts due to lower interest rates.