Texas Comptroller Glenn Hegar released May 2023 state sales tax revenue which totaled $3.84 billion and is 4.1 percent more than in May 2022. The majority of May sales tax revenue is based on sales made in April and remitted to the agency in May.
“The rate of sales tax revenue growth continues to moderate, with the increase in May – compared with a year ago – representing the lowest annual rate of increase observed in the 26 months since the end of pandemic restrictions,” Hegar said. “This slower growth is expected and in line with the economic outlook we detailed in our Biennial Revenue Estimate, as both the rate of inflation and growth in real economic activity slow as demand cools in the face of higher interest rate policy and reduced fiscal stimulus from the federal government.”
As Hegar mentioned a moderate increase across the state in sales tax, the City of Brownfield also followed suit. According to the Comptroller’s office, Brownfield brought in $168,142.62 for the month of May which was only a 0.37% increase from May of 2022 which was $167,516.51. However, in the year-to-date comparison, Brownfield has brought in $675,676.22 which is a 6.68% increase from the year-to-date in 2022.
The City of Meadow continues to see sales tax percentages in the double digits. Meadsow brought in $1,962.00 in May of 2023, compared to $1,687.38 in May of 2022. That is a 16.27% increase. The year-to-date comparison, Meadow is up 25.24% with $9,312.36 being brought in compared to the $7,435.36 for year-to-date in 2022. The City of Wellman also continues to see sales tax growth by bringing in $692.75 for May 2023 which is up 5.13% from this time last year. The year-to-date is also up by 24.86% bringing in $3,291.36 compared to the year-to-date of 2022, $2,636.02.
For Terry County, unfortunately, there is a 10% decline in sales tax revenue compared to May 2022. Terry County brought in $61,724.18 for May 2023 whereas it brought in $68,588.41 in May 2022. Although there was a negative monthly setback for May, the year-to-date compared to 2022 is still up 16.69%, bringing in $310,511.23 for the year-to-date for 2023. For year-to-date in 2022, Terry County had brought in $266,093.24.
Hegar went on to say, “While receipts from the oil and gas mining sector continued their large year-over-year gains, with remittances once again nearly 50 percent higher than they were the same month last year, growth in receipts from other sectors driven by business spending stalled. Receipts from the construction, manufacturing, and wholesale trade sectors barely exceeded year-ago levels.”
“Remittances from the retail trade sector were negative in May compared with May last year, making it the second time in three months receipts from retail trade have dipped below year-ago levels. Declines were evident in most subsectors, including building materials and home improvement stores, clothing and accessories stores, electronics and appliance stores, furniture and home goods stores, general merchandisers, and sporting goods and hobby stores.
“Restaurant receipts increased at about the inflation rate for food away from home in April.”
Total sales tax revenue for the three months ending in May 2023 was up 5.6 percent compared with the same period a year ago. Sales tax is the largest source of state funding for the state budget, accounting for 56 percent of all tax collections.
Texas collected the following revenue from other major taxes:
- motor vehicle sales and rental taxes — $599 million, down 1 percent from May 2022;
- motor fuel taxes — $340 million, up 6 percent from May 2022;
- oil production tax — $497 million, down 17 percent from May 2022;
- natural gas production tax — $199 million, down 52 percent from May 2022;
- hotel occupancy tax — $71 million, up 4 percent from May 2022; and
- alcoholic beverage taxes — $156 million, up 2 percent from May 2022.
Fiscal 2023 franchise tax collections totaled $6.22 billion year-to-date through May. Compared with collections through May 2022, year-to-date franchise tax collections were up 20.7 percent, an extraordinary increase driven by boom conditions in 2022 following the pandemic as well as pricing dynamics in the high inflation environment driving corporate revenues up faster than costs.
