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CHARLESTON - Tax revenues in October in West Virginia were slightly below estimates, brought down by larger income tax refunds and payments of severance tax revenues to local governments.
According to a monthly tax revenue report released by the Senate Finance Committee, general revenue collections for October were $380.4 million, nearly $8 million, or about 2%, below the estimate of $388.1 million set by the state Department of Revenue.
Despite this, tax collections for the first four months of fiscal year 2027 beginning in July were $1.789 billion, which was 3.1% above the $1.734 revenue estimate. Fiscal year-to-date surplus tax collections were $54.4 million.
"West Virginia continues to maintain a strong fiscal position while we deliver meaningful tax relief to hardworking families," Gov. Patrick Morrisey said in a statement Monday afternoon. "We’ve reduced personal income taxes, held the line on spending and worked to make government more efficient. Our focus remains on protecting taxpayers, keeping our budget balanced, and creating the conditions for more jobs and economic growth across our state."
Revenue collections for the personal income tax and consumer sales and use tax remained above water for October. According to the report, October personal income tax collections of $168.6 million were .4% above the $168 million revenue estimate, for a $597,000 surplus. Fiscal year-to-date personal income tax collections of $722.2 million were 2.3% more than the $705.8 million estimate for a $16.4 million surplus.
Both October and fiscal year-to-date personal income tax collections slightly exceeded similar numbers in fiscal year 2026, a positive sign given multiple years of cuts to personal income tax rates since 2023, include Morrisey's 5% cut approved by the Legislature earlier this year, Eric Nelson, secretary of the Department of Revenue, said on WV MetroNews Talkline Monday morning.
"Our personal income tax was flat for the month but remain very strong year-to-date," Nelson said. "I'm pretty excited about the positive over the prior year when you factor in the Gov. Morrisey-led 5% personal income tax break and we're still up above that."
October consumer sales and use tax collections of $142.4 million were 4.7% above the $136 million revenue estimate, providing a $6.4 million surplus for the month. Fiscal year-to-date sales tax collections of $661.9 million were 4.1% above the $636 million estimate for a $25.9 million surplus.
October corporate net income tax collections of $1.8 million were 87.9% below the $15 million revenue estimate. Fiscal year-to-date corporate net income tax collections of $83.5 million were 3.7% below the $86.7 million revenue estimate.
Nelson said larger income tax refunds and the effects of President Donald Trump's One Big Beautiful Bill Act on income taxes played a role in the downturns.
"In the month of October, our corporate net income tax was a big driver," Nelson said. "A lot of this is being driven by the tax effects on corporations in the Big Beautiful Bill and ... we had a number of very large refunds totaling in excess of $18 million. Even though collections were stronger than estimates, our refunds outpaced that and resulted in a down month."
The severance tax on coal, natural gas and oil was also down due to payouts of revenues to local governments. The Department of Revenue estimated that October severance tax collections would be in the hole by $3 million. Actual severance tax collections in October were $885,000. But fiscal year-to-date severance tax collections of $87.6 million were 8.8% more than the $80.5 million estimate, providing a $7.1 million surplus for the first one-third of FY27.
"October looks a little different because it is a quarterly month where we make local payments of coal and gas severance taxes to our counties and municipalities," Nelson said. Our local payments were roughly $40 million, so that is taken off and reduced from our revenue collection."