Sales Tax’s Double-Digit Dip

Texas collected $1.65 billion of sales tax revenue in December, down 11.6% from December 2009 revenue, Comptroller Susan Combs said in the latest monthly revenue report.

The Lone Star state will distribute $405.2 million of the December revenue this month to cities, counties, transit districts, and special-purpose taxing districts.

December state sales tax collections and January allocations to local governments represent retail sales in November.

Combs said state tax collections are down across most major sectors, including retail sales, oil and gas, construction, and manufacturing, but the economy should turn around soon.

“Declining sales tax collections, beginning in February 2009, have now extended through December 2009,” Combs said in the revenue report issued last week.  “It is expected the double-digit declines in tax collections seen over the last half-year will first moderate with collections returning to growth during the first or second quarter of 2010.”

Cities will receive $274.4 million in January allocations, down 11.4% from the $309.9 million distributed in January 2009. Houston will receive $33.9 million, down 18.5% from $41.6 million last year. San Antonio’s allocation is down 5.6%, to $14.8 million from $15.7 million in January 2009.

Dallas posted a 20.5% decline in sales tax collections, from $18.3 million in January 2009 to $14.5 million.

However, Dallas chief financial officer David Cook said sales tax collections were unusually high last year because of a favorable audit adjustment.

Without that adjustment, he said, the month-to-month revenue decline would be about 5%.

Ten local transportation districts will receive $90.1 million in January.

The 123 counties with a sales tax will share $24.3 million, and 163 special taxing districts will receive a total of $16.2 million.

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