Texas sales tax numbers point to economic strength
DALLAS – Texas sales tax collections soared more than 13% year-over-year in April, setting the fourth straight monthly record.
“April state sales tax collections grew significantly across all major economic sectors,” said Texas Comptroller Glenn Hegar. “While the strongest growth was in remittances from oil and gas-related sectors, tax receipts from retail trade and restaurants also grew briskly.”
Total sales tax revenue for the three months ending in April 2018 was up 9.8% compared to the same period a year ago, Hegar reported.
Sales tax revenue is the largest source of funding for the state budget, accounting for 58% of all tax collections. Texas does not have a state income tax.
Revenue from other major taxes on motor vehicle sales and rentals, motor fuel and oil and natural gas production also rose in April, Hegar said.
Tax revenue from motor vehicle sales and rental taxes shot up 32% to $293.2 million.
Motor fuel taxes rose 2.1% to $322.6 million, while oil and natural gas production taxes soared 56% to $445.2 million.
Texas accounted for 39% of national crude oil production and 84% of its exports, according to a report last month from the Texas A&M Real Estate Center.
The employment expansion extended its 20-month streak, adding more than 70,000 jobs this year alone, the report said. Economic opportunities continued to attract both international and domestic migration to Texas.
The Dallas Fed’s Business-Cycle Index, a measure of current economic activity in the state, posted 5.2% quarterly annualized growth. The metropolitan business cycle indices were led by Austin at 8.5%. Dallas and San Antonio maintained moderate growth at 3.6% and 3.7%, respectively. Stagnant wages slowed the Houston index for the second straight month to 5.9%, below its post-Harvey peak of 7.8% in December.
The Texas Leading Economic Index, a measure of future directional changes in the business cycle, balanced around a two-year high amid fewer initial unemployment insurance claims, gains in the U.S. leading index, the report said.
Optimism regarding recent tax cuts and employment opportunities pushed the Texas Consumer Confidence Index up two points, reaching a record high.
Recently released 2017 data revealed a 1.4% increase in the Texas population, nearly doubling national growth. The rate of increase, however, slowed to the lowest level since 1989, according to the Texas A&M study.
The Dallas-Fort Worth metropolitan area topped the nation in absolute population increase, adding 146,200 residents last year, while Houston ranked second at 94,400, the fewest since 1999. In San Antonio, population growth held firm at 1.9%, for a net increase of more than 47,000 residents.