These figures are largely based on transactions made in July, with the taxes paid in August.
The total tax collections from August show a 15 percent decrease from the same month in 2019. With hotels still struggling from dearth of travel, hotel occupancy tax revenues are still significantly down from last fiscal year — plummeting nearly 50 percent from August 2019.
Oil production tax revenues continue to underperform, down 38 percent from 2019 largely due to the global glut and depressed travel. To that end, motor fuel taxes were 12 percent below their 2019 levels and natural gas production taxes were down 114 percent.
All that said, the state’s total net revenue from August 2020 is 20 percent above the same month last year.
And as August came to a close, so did the fiscal year.
Due to an economically prosperous first half of the fiscal year, which saw the unemployment rate drop to historic lows both in Texas and across America, the general revenue fund-related returns were only 1.5 percent below the previous year.
However, tax collections for all funds in total fared slightly worse, 3.4 percent lower than Fiscal Year 2019.
The total tax collection for July of 2020 should be mostly compared with May of 2019 due to the federal government’s postponement of Tax Day this year because of the pandemic.
Comptroller Glenn Hegar added, “Consumer spending was supported in July by enhanced federal benefits, which have since been reduced or expired. Consequently, further declines in sales tax revenue may ensue in the coming months.”
Meanwhile, total sales taxes for Fiscal Year 2020 yielded a slight increase of 0.2 percent from the previous year.
Hegar specified that the 2020 yearly revenues came out slightly above his revised revenue estimate from July.
“This was, in part, due to surprisingly strong July sales tax collections as Texans’ spending for home improvement projects increased while they spent more time at home both for teleworking and staycations, in lieu of leisure travel,” he explained.
Despite the closing of the fiscal year, the Texas economy continues to struggle from the burden of widespread closures, especially in certain industries. But Governor Greg Abbott stated on Monday that he “hope[s] to provide updates next week about next steps.”
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Brad Johnson is an Ohio native who graduated from the University of Cincinnati in 2017. He is an avid sports fan who most enjoys watching his favorite teams continue their title drought throughout his cognizant lifetime. In his free time, you may find Brad quoting Monty Python productions and trying to calculate the airspeed velocity of an unladen swallow.