West Virginia’s state tax revenue was ahead of monthly projections by $44 million, driven largely by strong returns in personal income and consumer sales taxes.
General Revenue collections for May totaled $381,488,880, exceeding the monthly estimate of $336,962,000.
Headed toward the end of the fiscal year, year-to-date figures show a surplus of more than $313 million.
Total year to date general revenue collections are $5,124,126,155.
Overall, the state has collected 96% of its total estimated yearly revenue with one month remaining in the fiscal year.
“The budget that was passed had roughly $245 million in the back of the budget for things like road construction and some other one time expenditures, so if we stay on this pace, which we expect to for June, we’ll be able to cover all those expenditures as we had budgeted,” said Revenue Secretary Eric Nelson.
Severance tax revenue, representing taxes on the extraction of non-renewable natural resources like oil, natural gas, coal and timber, notably reached 118% of the annual estimate or $106,608,229.
For May, severance tax collections totaled $39,632,071, above the monthly estimate of $32,537,000 by $7,095,071.
The primary factors driving West Virginia’s revenue growth in May were the personal income tax and the consumer sales and use tax, which together accounted for the majority of the month’s $44.5 million surplus.
Personal income tax collections represented the largest contributor to the month’s surplus, exceeding monthly estimates by about $25.5 million.
Nelson attributed this strong performance to slower-than-expected tax refunds and lower usage of the car credit.
“Some of our refunds have slowed a little bit, and there’s been lower use of the car credit,” he said.
Consumer sales and use taxes exceeded estimates by $16.7 million for the month
While the outlook remains positive, Nelson expressed caution about inflationary pressures and noted a decline in tobacco tax revenue as consumers transition to vaping.
“There’s always that room for caution,” Nelson said.