CHARLESTON, W.Va. -- State tax collections continued to struggle in August, coming in $14.4 million below estimates, and nearly 5 percent below August 2012 revenues, deputy Revenue secretary Mark Muchow said Tuesday.
Overall, the state took in $273 million in tax revenue in August, below estimates of $287.4 million.
For the first two months of the 2013-14 budget year, sales tax collections are running about $200,000 ahead of estimates, at $203.2 million.
"That's encouraging, because we have the grocery tax elimination in place," Muchow said.
West Virginia removed the final 1 percent sales tax on groceries on July 1, reducing sales tax collections by about $2.5 million a month.
Severance tax collections of $34.3 million were $2.8 million below estimates, and down 4.6 percent from August 2012.
However, severance taxes for the first two months of fiscal 2014 are running about $4 million ahead of estimates.
"I suspect most of it's driven by natural gas production, and a little better pricing than a year ago," Muchow said.
Personal income tax collections continued to lag, in part as taxpayers continue to claim tax credits of up to $7,500 on alternative-fuel vehicles. A flurry of last-minute purchases of flex-fuel vehicles eligible for the credits before the tax break was repealed on April 14 is expected to cost the state a total of $100 million in lost tax revenue.
August personal income tax collections of $114.6 million were $4.4 million below estimates, Muchow said.
Income tax refunds for the month totaled $8.4 million, compared to $4.5 million in August 2012.
Muchow said very sluggish growth in wages and employment is keeping income tax collections below projections.