DALLAS – Several of the largest Texas cities on the Mexican border are seeing declines in sales tax revenue as local merchants report fewer visitors crossing the Rio Grande.

In addition to stricter enforcement of immigration policies on the U.S. side of the river since Donald Trump’s election, a falling peso has played a role, officials say.

At the northernmost tip of the Texas-Mexico border, El Paso, the most populous border city, is enjoying a 1.8% increase in sales tax revenues for the year to date, according to Texas Comptroller Glenn Hegar. El Paso’s retail trade is estimated at $12.24 billion a year, with about $980 million of that from residents of northern Mexico.

Neighboring Socorro in El Paso County has seen a nearly 21% drop over the same period.

At the southernmost tip of Texas, Brownsville is seeing a decline of 4.03%.

McAllen, the 15th most populous city in Texas, is down 6.2% for the year, while nearby Harlingen is up 3.4%.

To the north, Laredo, the busiest border port in Texas, has seen sales tax revenue fall 1.25%, while upstream Del Rio is receiving 1.94% less sales tax revenue for this year to date compared to the same period last year.

For all Texas cities, sales tax revenues are up 2.6% for the year to date, Hegar reported earlier this month. For all local governments, sales tax collections grew 4.9% in April distributions, Hegar said.

“The cities of Houston, San Antonio, Dallas and Austin saw noticeable increases in sales tax allocations,” Texas Comptroller Glenn Hegar said of the April sales tax report.
“The cities of Houston, San Antonio, Dallas and Austin saw noticeable increases in sales tax allocations,” Texas Comptroller Glenn Hegar said of the April sales tax report.

The allocations are based on local sales taxes collected in February by businesses that report tax monthly. The revenues are calculated in March and distributed to the local entities in April.

“The cities of Houston, San Antonio, Dallas and Austin saw noticeable increases in sales tax allocations,” Hegar said. “The cities of Sugar Land, McAllen, Irving and Grand Prairie saw noticeable decreases.”

McAllen Mayor Jim Darling told National Public Radio that his city is one of the top sales tax collectors in the state. About 40% of the city’s sales tax revenue comes from Mexican citizens shopping in McAllen, Darling said.

“We've been kind of probably hurt by the rhetoric going on in Washington more than any other community,” Darling told NPR. “When people go away, it's harder to get them to come back. It could be a long - longer-term problem for us than we'd want, too.”

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