Charleston, W.Va. (WVDN) – In February, West Virginia’s revenue collections of $354.9 million exceeded projections by $33.7 million. These results were primarily due to higher severance tax collections associated with cold weather-related natural gas prices and income tax refunds trailing projections.
“As we continue to address West Virginia’s financial challenges, I’m pleased to see revenue exceed expectations for February,” said Revenue Secretary Eric Nelson. “We will continue to work with the Governor’s office and the Legislature to pass a balanced and forward-thinking 2026 budget that addresses these challenges.”
February General Revenue Fund
February collections of $354.9 million were $33.7 million above estimate and more than 25% ahead of prior year February collections. Prior February collections were much lower due to one-time February tax refund payments to owners of business pass-through entities. Cumulative collections of $3.509 billion are $61.6 million above estimate and 2% below prior year receipts.
Details by major component follow:
February Personal Income Tax collections of nearly $101.1 million were $20.7 million above estimate and nearly 250% ahead of prior February collections. Cumulative income tax collections of more than $1.399 billion are $4 million above estimate and 2.6% below prior year receipts. Prior year receipts reflected the impact of more than $127.7 million in tax refund payments. Refund payments for this February totaled roughly $73 million or $15 million below estimate. The new motor vehicle property tax credit contributed to a slowdown in return filings and refund claims to date in comparison with estimates. Cumulative collections of more than $1.398 billion were $3 million above estimate and 2.7% below prior year receipts.
February Consumer Sales Tax collections of nearly $143.1 million were $2.2 million below estimate and 0.7% ahead of last year. Cumulative collections of more than $1.195 billion are $5.3 million above estimate and 2.3% ahead of last year.
February Corporation Net Income Tax collections of nearly $5.2 million were $2.3 million above estimate but 20% below of prior year receipts. Cumulative collections of $210.6 million were 13.6% lower than prior year receipts but $39.6 million above estimate. Federal tax policy uncertainty was a factor in recent tax collection trends relative to estimate.
Severance Tax collections totaled $45.7 million in February and $193.2 million for the year-to-date. February collections were nearly $17 million above the monthly estimate and 45.1% above prior year receipts. The monthly revenue gain was partially attributable to a bigger than usual carryover of collections due in late January to early February. In addition, an upward movement in natural gas prices related to winter heating needs was a contributing factor to the higher tax receipts. Year-to-date collections were still nearly $43 million below estimate and 3.1% below prior year receipts. Low energy prices played a significant role in revenue decline over the past two years.
Tobacco Products Tax collections of nearly $10 million were $1.0 million below estimate in February and 14.6% below prior year receipts. Cumulative collections of $94.1 million were $7.6 million below estimate and 10% below prior year collections.
Interest Income totaled nearly $12.2 million in February and more than $133.7 million for the year-to-date. Cumulative collections were $35.5 million above estimate but 13.9% below prior year collections. Interest income is trending lower over time with declining short-term interest rates.
