CHARLESTON, W.Va. — Though state tax collections exceeded January’s estimate, officials weren’t ready to declare an economic turnedaround.

Tax revenues brought in approximately $391 million last month, some $8 million above projections. Yet state Deputy Revenue Secretary Mark Muchow said the uptick in collections was largely a “technical issue” as the state remained $73 million below estimates for the fiscal year.

State Revenue Secretary Bob Kiss said Monday the current state budget may require more cuts or a midyear search for additional revenue.

“There may be a need for more action,” Kiss said.

Gov. Earl Ray Tomblin ordered a hiring freeze last month and reduced state spending in some agencies. The legislature has also been asked to appropriate one-time revenues.

“We may need to revisit that, yes,” Kiss said.

The major drag on  collections this year has been the personal income tax category, which shows a current shortfall of $61.6 million. The consumer sales and use tax ended January with a shortfall of $14.2 million.

“Everything else put together is pretty close to being on estimate,” Muchow said.

There are five months remaining in the fiscal year and Muchow said natural gas production will be a big key heading forward.

“We’ve seen things slow down recently,” Muchow said, “(but) with improvements in natural gas production and maybe a more stable coal environment, hopefully we’ll have a little gain on the severance tax side.”

Kiss was cautious about January’s revenue numbers improving over December.

“I still don’t think we’ve turned the curve that we keep hoping to turn,” he said. “We continue to see, I think, some significant challenges for the current fiscal year.”

Kiss predicted the state would not have a problem providing timely state income tax refunds, thanks of a bill in front of the legislature that would allow money to be taken out of the state’s Rainy Day fund.

“If that legislation passes I don’t anticipate refunds are going to be a problem,” Kiss said.

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  • firegoat

    Part of the problem is that the Feds cut
    funding to the states, and increased the amount the states are taxed.
    Feds killed a lot of business, such as coal minning, and are taxing small business out of business.
    Fix the Feds, fix our state. A lot of it anyway.

  • Mason County Contrarian

    Robbing Peter to pay Paul while giving Peter a tax break still won't cut it for very long.

    On top of that, both Peter and Paul's employer, Judas, is paying less in B&O taxes and laughing all the way to the bank. Matthew, John, and Mark are hoping Judas' windfall will mean they'll get a job.

    Remember, this is Judas with whom you're dealing.

  • cutty77

    WV is in a little trouble,and at least Mark is letting everybody know about it. This Cold weather is helping The Coal Market a little. Just take a look at what is happening in Colorado. WV is a very small state,and the people in it have big mouths. We need all the money we can get our hands on.

  • Concerned

    Two words. Food tax.

    • Rich

      As revenues were declining, it was irresponsible to take the political and symbolic step of eliminating the sales tax on food without replacing it with some revenue source. I recognize it is/was a regressive tax, but to cut it without replacing with another revenue source was just grandstanding.

      • susanf1218

        I agree that removing the food tax was a stupid, meaningless gesture designed to give the politicians something to brag about. I disagree that it is a regressive tax - I would argue that it is a fair tax - everyone eats, therefore everyone should pay. Although that isn't entirely true either b/c Food Stamps and other food assistance benefits aren't taxed. But saving the individual consumer 6 cents off of every dollar they spend on food purchases was/is hardly significant. But, those 6 cents collectively add up to a considerable amount of revenue that the state has lost. Brilliant move by our esteemed legislators - not!!

  • Interesting123

    Tax cuts without matching and planned expenditure reductions leads to budget deficits. I believe in lower taxes, but this is clearly a manufactured crisis brought on by a lack of forethought.

  • hilljack

    Lets look at all state departments (can you say DEP) and see which ones are doing any work. I'm sure there are lots of cuts that can be made. Don't be coming up my street wanting more taxes. Live within your budget like most working West Virginians do.