State tax revenue continues to rise

State sales tax revenue continues to rise out of the economic downturn which accompanied the COVID-19 pandemic, totaling $3.16 billion in June, an 18.1 percent increase over last year.

Analysts attributed the rise to elevated consumer spending and a rejuvenated oil and gas sector. Compared to pre-pandemic numbers, the amount collected was up 10.4 percent over 2019.

The majority of the sales tax revenue reported for June is for sales made in May and remitted to the state last month.

“Monthly state sales tax collections remained exceptionally strong, with receipts from all major sectors other than those related to oil and gas surpassing pre-pandemic levels,” Texas Comptroller Glenn Hegar said.

“Elevated spending at clothing stores, electronics and appliance stores, sporting goods stores, building materials and home furnishing stores, some general merchandisers and online retailers continued, though growth in online sales and at big box merchandisers slowed as consumers returned to other physical retail alternatives,” he added. “Remittances from food and beverage stores were constrained by declining sales of alcoholic beverages for off-premise consumption, as consumers returned to restaurants and bars.”

Restaurant receipts were a welcome strong point for the month, substantially surpassing pre-pandemic levels, Hegar said, “with brisk business continuing at take-out-oriented establishments and modest recovery at some dine-in outlets.”

Breaking down tax categories, motor vehicles sales and rental taxes totaled $591 million, a record, and were up 50 percent over June 2020.

Motor fuel taxes were $315 million, up 26 percent from June 2020; oil production taxes totaled $363 million, up 339 percent from June 2020; and natural gas production taxes were $159 million, up 689 percent from June 2020.

In other categories, the hotel occupancy tax was $54 million, up 137 percent from June 2020, and alcoholic beverage taxes were $138 million, a record monthly amount, and up 112 percent from June 2020.