Tag: Revenue Collections

Justice: September Revenue Numbers Show Surplus Growth Return

In a Justice administration media briefing Friday afternoon, Revenue Secretary Dave Hardy said September revenues were $210 million above than the estimated budget

West Virginia’s state administrators note that this month’s state budget numbers show the personal income tax cut is not hurting but helping revenue collections.  

With revenue amounts for July and August prompting administrative concern, July being about $7 million, Gov. Jim Justice said the September numbers were really good news. 

In a Justice administration media briefing Friday afternoon, Revenue Secretary Dave Hardy said September revenues were $210 million above the estimated budget. 

Hardy said even with the 21.25 percent personal income tax cut that passed earlier this year, the state is breaking even with income tax collections compared to where it was a year ago.  

“That means that we have grown our personal income tax income about 20 percent,” Hardy said. “That’s the story for September, that the state income taxes and our incomes are growing to show that type of revenue growth in such a quick way.”

Hardy said September corporate net income tax collections were $54 million above estimate, growing by 2.2 percent compared to a year ago.

 He also said the consumer sales tax was $11.2 million above estimate for September, almost 10 percent above where it was for September 2022.

Independent budget analysts have repeatedly said the Justice administration sets its monthly revenue estimates artificially low.  

Severance Tax Shortfalls Could Challenge Record Budget Surplus Numbers

Decreases were expected in personal income tax revenues – and in severance taxes relating to a fluctuating coal, gas and oil market.

Breaking down West Virginia’s $1.8 billion surplus from the past fiscal year, while projecting a 2024 budget, Department of Revenue Deputy Secretary Mark Muchow told members of the legislative Joint Committee on Finance that while funding increases were consistent across the board, decreases were expected in personal income tax revenues – and in severance taxes relating to a fluctuating coal, gas and oil market.   

“We also expected a big reduction in severance tax due to lower energy prices,” Muchow said. “Here we have a reduction of $633 million, and the official estimate is 66.9 percent.”

Muchow said recent monthly severance tax collections are currently exceeding budget estimates and will be closely monitored going forward.  He said energy production was not the problem.

“Coal production is up 5.9 percent,” Muchow said. “We’re on target for 90 million tons of coal. And natural gas production is up 9.9 percent. It’s all about the price. The math is pretty easy, our tax is 5 percent of the price. So we will rise or fall on price. And we had a very warm winter last winter. Who knows what’s coming in the future?”

Gov. Jim Justice has said new workers and their families coming to West Virginia will offset the 21.25 percent personal income tax cut implemented this year. 

Revenue Secretary Dave Hardy noted that these revenue streams tend to slow down in July and August.

“As of the end of August our consumer sales tax revenue was up 2.5 percent from a year ago,” Hardy said. “Our personal income tax revenue as of the end of August, was down 16.2 percent. Well, we did a 21.25 percent income tax reduction. So, the fact that our revenue is only down 16.2 percent in the personal income tax category means that we still have real growth in income in our state.” 

Hardy said the personal income tax cut will put a projected $696 million back into citizens pockets through the PIT reduction.

W.Va. Tax Revenues Far Above January Estimates

Tax revenues collected in West Virginia last month were more than 29 percent above receipts at the same point of the previous fiscal year, Gov. Jim Justice said Wednesday.

January collections totaled $573 million, which was nearly $137 million above estimates, the Republican governor said in a news release.

For the first seven months of the fiscal year, collections of $3.1 billion were about $531 million above the year-to-date estimate, the statement said. It’s a record for total surplus through the month of January, Justice said.

Also in January, the state set records for the highest year-to-date amounts collected from personal income, consumer sales and severance taxes on industries such as coal, oil and natural gas.

Gov. Justice Announces Nearly $7 Million Revenue Surplus For December

Gov. Jim Justice announced December revenue collections in West Virginia totaled nearly $430 million dollars — slightly more than what was collected last year.

In a Thursday press release, the governor said revenue collections for December came in $6.9 million above estimates, which was 1.2 percent above prior year receipts. Justice said the “state is still in great financial health.”

The release highlighted areas such as personal income tax, which saw $175 million — nearly 3 percent ahead of prior year receipts.

Consumer sales tax collections were just below $127 million, which was more than $1 million below estimates, but ahead by nearly 3 percent of prior year receipts.

December severance tax collections totaled nearly $43 million. Monthly collections were more than $0.1 million above estimate and 5.1 percent below prior year receipts.

Business & Occupancy tax collections totaled nearly $17.6 million in December. Monthly collections were up 121 percent from the prior year receipts largely due to a carryover of deposits due at the end of November to early December.

Corporation net income tax collections totaled $30.4 million in December. Monthly collections were nearly $2.6 million below estimate.

According to the governor’s release, the month of December also marked the end of the second quarter of fiscal year 2020. The release also states that the first two months of the 2020 fiscal year were “disappointing” in terms of revenue collections. However, the last four months were $16.4 million above estimates.

Coal sales have also dipped because of both a global economic slowdown with lower steel demand, and stiffer domestic competition from natural gas in the electric market, according to the release.

 

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