Charleston – West Virginia’s January tax collection fell just short of the state’s tax surplus at $1 billion.
Now Gov. Jim Justice and the Republican majority in Congress must figure out how to return some of that to taxpayers.
According to the monthly report of the State Senate Finance Committee, taxes collected in January were $621.1 million, 35% higher than the $461.9 million estimate set by the State Department of Revenue, and $162.2 million. of excess tax revenue has been generated.
Year-to-date tax collections for fiscal 2023, July-January 2022, were $3,676 million, 37% above estimated revenues of $2,681 million, with five months left in the fiscal year. $95.3 million in tax revenue surplus.
“We knocked it out of the park again in January,” Justice said Wednesday at a virtual administrative briefing from his office at the Capitol.
Half of the 2023 surplus comes from higher coal, oil and gas prices. Year-to-date, he collected $631.2 million in retirement taxes, 373% above his estimated $133.4 million, and generated $497.8 million in excess tax revenue. In January, his retirement tax collection was $90.3 million, his $64.3 million surplus, 247% higher than his estimated $26 million.
More than 40% of the $3.676 billion in tax revenue collected to date has come from personal income tax collections, and 18% of the state’s year-to-date tax revenue has come from surplus personal income tax collections of $181.6 million . Personal income tax collections for January were $305.3 million, 20.3% higher than revenue estimates of $253.9 million, and his $51.4 million surplus for the month.
Personal income tax is at the center of the West Virginia tax reform debate, with both the Judiciary and House of Representatives supporting a gradual 50% reduction in the personal income tax rate across all six tiers, and Republicans in the state Senate scrutinizing the plan. doing.
“It would be utterly ridiculous not to think that West Virginia could very safely, very conservatively go ahead with a 50% tax cut, especially if we were to do it wisely,” Justice said.
The House passed House Bill 2526, the governor’s plan, more than two weeks ago, but the Senate has yet to take the bill to committee. Instead, while the Senate Republican leadership is developing its own plan, the long-term financial implications of the governor’s plan, combined with the desire to use up the additional surplus dollars the state has, have raised concerns. I’m here.
“I am willing to compromise with the Senate if they give me anything,” said Justice. We don’t have to go to auctions,” said Justice. It’s not our money.”
HB 2526 phased in a 50% personal income tax cut, with the 30% tax cut backdated to January of this year. $61.8 million will be returned. Years ending in June. A further 10% cut will start in July, returning $1.085 billion to taxpayers, with the final 10% cut starting in July 2024, and if fully implemented he will be 14 $92 million will be returned to taxpayers.
Last week, Senate Speaker Craig Blair announced that more bills with costs that could affect budget bills that would set the budget would last for the remainder of Congress in 2023 before the bill was fully scrutinized. He said the Senate would not rush to pass HB 2526 until it is passed by . July 2024
Justice proposed a General Revenue budget of $4.884 billion for 2024. That’s 5% above his 2023 General Revenue budget of $4.645 billion, which lawmakers passed last year. State revenue officials estimate the state could bring in her $6.1 billion next fiscal year, providing the state with $1.216 billion in excess tax.
The state also has more than $500 million in excess tax revenues after ending the last fiscal year in June, $1.3 billion more than estimated revenues. Lawmakers plan to consider 28 additional appropriation bills that would cut that surplus to nearly $200,000. Senate Finance Committee Chairman Eric Turr, Republican Putnam, said his committee will meet with state officials on Friday to ask them about these costs.
Tarr also said lawmakers should consider the significant costly bills passed in this session, adding that the state’s Rainy Day Fund will also receive $300 million to cover losses from investment losses. You said you could throw in dollars. The Rainy Day Fund fell to his $916.5 million after he surpassed $1 billion in September for fiscal 2022.
“We’ll have to see what the state spends and then decide how much revenue we’re not going to bring in,” Tarr said after Wednesday’s floor session. “We want tax cuts, and we have money to cut taxes, but we don’t have money for irresponsible tax cuts. Until we know what the state’s spending will be, we have no suggestions as to what that revenue should be. I don’t think I will ever issue a
State Department revenue officials say West Virginia will be able to spend $1 billion by fiscal 2027 as long as revenue estimates are kept low, budgets are kept flat, and new spending increases are limited to 3% each fiscal year. We believe we will continue to end future fiscal years with surpluses above the dollar. Year. HB 2526 also creates a $700 million fund to cover potential shortages and market disruptions that could hurt state finances when tax cuts begin.
When asked about Tarr’s concerns, Justice accused Republican lawmakers of creating fear.
“We keep trying to come up with some sort of roadblock or roadblock that scares people,” Justice said. “At the end of the day, market conditions drive it, and we’re putting those numbers into numbers, and we’re just continuing to do that. I don’t know what we’re going to do.”
“At the end of the day, we’ve done really well in this state. We need to keep doing something that rewards people,” Justice said. Very few people are trying to throw one after another I think what we should do is sit down and if they want this to go a little slower let’s go a little slower. It doesn’t have to be %.”