Texas state sales tax revenue reaches nearly $3.7 billion in September

State sales tax revenue totaled nearly $3.7 billion in September, marking a 17.2% increase compared to September 2021.

Texas Comptroller Glenn Hegar announced Monday that sales tax revenue topped at $3.69 billion with the majority of sales tax revenue coming from August and remitted to the agency in September.

Hegar said state sales tax collections climbed rapidly in September with growth coming from all major economic sectors.

“Surging receipts from non-retail sectors indicate that the exceptionally strong spending by businesses in recent months continued unabated,” Hegar said. “Spurred in part by inflation in building materials and other business input prices, the mining, construction, manufacturing and wholesale trade sectors have each exhibited double-digit growth in sales tax remittances for 10 or more consecutive months.”

Texas collected $616 million from motor vehicle sales and rental taxes, a 13% rise from September 2021. Motor fuel taxes were recorded at $328 million, an increase of 2% from last September. Oil production tax was tallied at $552 million, up 41% from September 2021. Texas brought in $480 million from natural gas production taxes, a rise of 91% from September 2021. Gas production taxes brought in $480 million for the state — a 91% increase from last year. Hotel occupancy tax was recorded at $57 million, up from 11% from September 2021. Texas tallied $138 million from alcoholic beverage taxes — a 13% rise from last September.

“Receipts from retail trade and restaurants grew moderately and at less than the rate of consumer price inflation, reflecting potentially higher shares of household budgets being allocated to rent, groceries and transportation expenses — items not subject to sales tax — in response to inflation,” Hegar added. “Receipts from online shopping, building material and home improvement stores, and automotive dealers and parts stores all had double-digit increases compared with last September. But receipts from clothing, electronics and appliances, and furniture and home furnishings stores were little changed, while receipts from general merchandisers and sporting goods and hobby stores were down from a year ago.”

Total sales tax revenue for the three months ending in September 2022 rose 14.9% compared with the same period a year ago. Hegar’s office stated that sales tax is the largest source of state funding for the state budget, accounting for 56% of all tax collections.