Tax revenue tops estimates for fifth straight month
CHARLESTON — As West Virginia enters the sixth month of the 2021 fiscal year, the state’s tax collections continue to exceed estimates.
According to preliminary numbers released by the Senate Finance Committee and the State Auditor’s Office on Tuesday, November tax revenue collections of $342.5 million came in 6.22 percent above projections for the month set by the Department of Revenue. The state netted a $20.1 million surplus for the month.
November tax revenue also came in 6.07 percent above collections for November of last year. The state brought in $322.9 million last November for fiscal year 2020. This year’s collections came in at $19.6 million more than last year.
Year-to-date, West Virginia collected $1.937 billion on tax revenue, giving the state a $131.7 million surplus for the first five months of the fiscal year — 7.29 percent above estimates. So far, every month has seen modest surpluses even as the COVID-19 pandemic creates uncertainty in the economy.
“All West Virginians should be incredibly proud of what we’re accomplishing, especially when you think about everything else that’s going on in this nation right now,” Gov. Jim Justice said in a statement Tuesday afternoon. “The pandemic, no question, has been a punch to the stomach. But we kept our economy moving and we’ve stayed on this great roll we’ve been on.”
As of the end of November the state has collected 42 percent of its total estimated yearly revenue of $4,574,514,000, according to the report. At this time, the state should have collected 39 percent of its yearly revenue. This current trend puts the state on track for meeting yearly revenue estimates.
Tax revenue for November was buoyed by collections of personal income tax, corporate net income tax, and the consumer sales and use tax.
The state collected $149.8 million in personal income tax revenue, which was nearly 11 percent more than the $135 million was projected to bring in. The state brought in $14.8 million more than projected. It was also $12.2 million more than personal income tax collections last year. Corporate net income tax revenue of $2.1 million was also $1.6 million more than the estimate.
As the state enter the traditional holiday shopping season that is anything but traditional due to the coronavirus, the state brought in 5.21 percent more in consumer sales and use tax revenue than the estimates projected. Consumer sales tax revenue was $133.6 million for November, which was $6.6 million more than the $127 million projection. It was also 7.49 percent more than sales tax collections this same time last year.
Despite having its first good month above estimate in October, revenue for the severance tax on coal and natural gas once again fell below estimates. November severance tax revenue was $21 million, which was 20.1 percent below the $26.3 million estimate and 18.2 percent below $25.7 million in collections last November. But year-to-date collections show severance tax collections just barely above projections — 0.06 percent for the fiscal year so far, or $27,955 above the $47.3 million estimate.
“As we watch over the state’s finances, we try not to get too high or too low. But we continue to be incredibly impressed and pleased with the numbers we’re seeing so far this year,” said Department of Revenue Secretary Dave Hardy. “To have month after month of surpluses, even during these challenging times, is really a testament to Governor Justice’s business acumen and leadership. It positions West Virginia really well to keep growing and to build more success off of success.”