CHARLESTON, WV (WOAY) – Gov. Jim Justice reports today that May Revenue Collections resulted in a $46.4 million surplus, which was 15.8% above prior year receipts.
Over the past two months, revenue collections have come in at a combined $100 million above estimate.
This also marks the 14th month out of the past 16 in which West Virginia’s monthly revenue collections came in above estimate.
“Our momentum in West Virginia right now is so good it’s unbelievable,” Gov. Justice said. “To think, when I walked in the door and we were flat bankrupt, what we would have given to have just one month of positive numbers. And now to have this sustained success, month after month, it’s just another sign that West Virginia’s economy is on the move like never before.”
May’s total collections of $380.9 million added to the year-to-date total collection amount of $4.28 billion. Year-to-date collections are $81 million above May 2019 revised estimates and 11.5% ahead of where the total collections were at this time last year.
“The net of it all is that our future is looking brighter than ever,” Gov. Justice said. “Not only do we have these historic revenue numbers, but we also just had our lowest unemployment rate in over a decade, and businesses are finally realizing we truly have something special going on right here in our great state.”
The following is a summary of May 2019 Revenue Collections:
General Revenue Fund
May General Revenue Fund collections of $380.9 million were nearly $46.4 million above estimate and 15.8% above prior year receipts. These numbers reflected strong year-end income tax payments deposited between mid-April and May.
Year-to-date collections of more than $4.278 billion were $81.0 million above estimate (as revised in May 2019) and 11.8% ahead of prior year receipts. The sharp rise in collections was attributable to very high rates of growth in Severance Tax, Corporation Net Income Tax, Consumer Sales Tax and Personal Income Tax collections. Year-to-date General Fund Severance Tax collections were 32% ($100.1 million) ahead of last year. Year-to-date Corporation Net Income Tax collections were 75% ($69.4 million) ahead of last year. Year-to-date General Fund Consumer Sales Tax collections were 10.5% ($115.6 million) ahead of last year. Year-to-date Personal Income Tax collections were 9.2% ($159.6 million) ahead of last year. As of the end of May, cumulative collections were nearly $291.3 million ahead of original estimates for the year and $452.6 million ahead of prior year receipts.
A summary of major components follows:
May Personal Income Tax collections of $156.2 million were $25.8 million above estimate and 19.3% above prior year receipts. Cumulative collections were $40.6 million (2.2%) above the revised estimate and 9.2% ahead of prior year receipts. The increase in monthly net revenue from the prior year was partially due to a sharp 46% increase in combined annual return and estimated tax revenues for the month. The monthly surplus was also partially attributable to an $11.6 million (496%) rise in non-resident withholding tax collections from the prior year. Wage and salary withholding tax payments of $131.6 million were 5.3% above prior year receipts. Cumulative withholding tax collections of nearly $1.56 billion were 9.6% above prior year receipts. Withholding tax collections previously grew by 9.1% during the final three months of FY2018.
Corporation Net Income Tax collections of $11.5 million were more than $8.8 million above estimate and 112.9% ahead of prior year receipts. Cumulative collections of nearly $161.5 million were $10.9 million above the revised estimate and 75% ahead of prior year receipts. Taxpayers were motivated to maximize their business deductions in the year prior to the implementation of federal tax reform (i.e., TY2017) and to defer income realizations until after the new lower tax rates first took effect. The result was a greater level of reportable taxable income in TY2018 and higher tax yield as reflected in annual return payments received in recent months.
May Consumer Sales and Use Tax collections of $116.8 million were $0.6 million above estimate and 10.2% above prior year receipts. Cumulative collections were $3.2 million above the revised estimate and 10.5% ahead of prior year receipts. Overall collection growth, including transfers to special revenue funds, was a robust 9.3% for the year-to-date.
May General Revenue Fund Severance Tax collections of $43.4 million were $6.2 million above estimate and 17.9% ahead of prior year receipts. Year-to-date General Revenue Fund Severance Tax collections were nearly $8.2 million above the revised estimate and 32.2% ahead of prior year collections. Total cumulative Severance Tax collections for all funds were up by 29.2%. Recent strong growth in collections was partially attributable higher oil and natural gas prices and greater sales of natural gas and natural gas liquids. In addition, coal exports were significantly higher during the first half of this fiscal year.
Tobacco Products collections totaled nearly $18.1 million in May, an amount that was nearly $2.5 million above estimate and 13.2% ahead of prior year receipts. Cumulative collections were still $5.9 million below estimate and 2.4% below prior year receipts.
May Business and Occupation Tax collections of $11.7 million were $1.5 million above estimate. Cumulative collections of nearly $113.4 million were $7.0 million above estimate and 8.0% ahead of prior year receipts.
State Road Fund
In May, total State Road Fund collections of $102.2 million were $2.1 million above estimate, but 15.6% below prior year receipts. Cumulative collections of $1.14 billion were $62.3 million below estimate and 0.9% below prior year receipts. The year-to-date shortfall was attributable to a relatively high estimate for federal fund reimbursements. Even though the actual reimbursements are below the estimate, the State is fully capturing all available federal reimbursement funds. As of the end of May, cumulative federal reimbursements of $340.3 million were 6.0% lower than last year.
State Road Fund collections attributable to State revenue sources totaled $78.4 million in May and $800.5 million for the year-to-date. Year-to-date collections were $26.6 million above estimate and 1.4% ahead of prior year receipts. Cumulative Motor Fuel Excise Tax collections of $417.9 million were $4.2 million below estimate and 3.7% ahead of prior year receipts. Cumulative License and Registration Fee collections of $147.1 million were $25.0 million above estimate and 17.0% ahead of prior year receipts. Cumulative Motor Vehicle Sales Tax collections totaled $216.3 million. Cumulative collections were $3.2 million above estimate and 3.9% ahead of prior year receipts.