Deputy Revenue Secretary Mark Muchow said Thursday that income tax refunds account for much of the shortfall. Both individuals and corporations overpaid what they owed last year because of uncertainty over 2010 federal tax rates, he said. Those two revenue sources fell nearly $33 million below estimate for the month, after back-to-back months of collections that beat expectations.
October’s ahead-of-schedule proceeds from taxes on coal and other extracted natural resources also played a role in last month’s results, Muchow said. These severance taxes came in $7.3 million below their projection.
But sales and use taxes, a sign of economic activity that supply nearly one-third of all general revenues, beat their target for the third straight month. The state collected $3.6 million more than the expected $95 million.
All told, November brought in $242.3 million, but $284.3 million had been forecast. A monthly revenue estimate hadn’t fallen that far short since March 2010, when the shortfall exceeded $58 million.
But total revenues since this budget year began July 1 are $27.2 million or 1.7 percent ahead of schedule. The state expects these taxes and fees to yield $4.015 billion by June 30, and so far they’ve brought in $1.64 billion. Approaching the midpoint of that budget year, revenues are also 3 percent above what they were at this time last year.
Muchow said the Tomblin administration is mindful of the bigger picture. He cited a deteriorating outlook for the U.S. economy, as the recovery limps along in the wake of the Great Recession. He also said the chances are high for a European recession.
‘‘Europe has some dark clouds over it,’’ Muchow said.
That could hurt West Virginia because that market receives more than half the state’s exports, particularly coal, Muchow said. Economists previously forecast a slowdown in the state’s coal industry because of the export market, but Muchow also noted that officials still hope demand in Asia will at least partly offset that.
‘‘We’re much more cautious going forward,’’ he said.
November’s collection figures coincide with a Thursday report from the National Conference of State Legislatures that finds state government finances slowly improving around the nation. The nonpartisan group’s survey found West Virginia among just seven states with positive fiscal outlooks for the rest of this budget year. Spending appears stable for most states, and few see deficit threats, it said.
‘‘However, despite these positive developments, the effects of the Great Recession continue to linger,’’ NCSL said in a release. ‘‘State tax collections still remain well below pre-recession levels.’’