CHARLESTON, W.Va. — State tax collections in West Virginia finished February a total of $9 million above estimates.
It was the second month in a row for better than expected revenue collections, but state officials said that’s largely due to a technicality since some insurance premium tax money came in earlier than expected.
Overall, revenue collections are $64 million below estimates for the year with just four months remaining until the fiscal year ends at the close of June.
“We hope that things will improve in the next few months (so) that we won’t have a whole lot more red ink,” said Mark Muchow, state Deputy Revenue Secretary.
He said personal income tax collections for February were about $6 million above estimates, canceling out down personal income tax numbers in January.
At the same time, sales tax collections came in $2.3 million below estimates. Muchow said those numbers could rebound in the spring since snow has forced many people to stay home.
“It appears that the winter weather has had a negative impact throughout the mid-Atlantic region in terms of sales tax collections for February,” he said.
Severance tax collections also missed estimates by $5.2 million in February and are, thus far, off the mark $7.3 million total for the year. Muchow said those collections have been on the decline for some time, falling 14% since 2012.
“Two years ago was our peak year for severance tax. We’ve had a little bit of a downward trend,” Muchow said. “Since then, most of the downward action is associated with the coal industry’s performance.”
He said there are some unknowns between now and the end of the 2013-2014 Fiscal Year, including the tax credit that can still be claimed for purchases of vehicles running on alternative fuels.
Lawmakers will address the state budget for the next fiscal year during an extended session next week.