Texas state sales tax revenue surges 11.5% in September on strong business spending

Sparked by strong business spending, Texas state sales tax revenue reached $4.4 billion in September, marking an 11.5% increase compared with the same month last year, Comptroller Don Huffines announced last week.

The September total is primarily based on economic activity and sales made in August.

Strong revenue growth

What they're saying:

"Sales tax collections remain above prior-year levels, giving lawmakers reason to keep property tax relief as the top priority," Huffines said in a statement. He added that continued revenue growth puts the Legislature in a strong position to use the state surplus to ease tax burdens for homeowners, businesses, and renters.

The backstory:

According to the comptroller's office, vigorous growth was driven largely by business spending sectors—including mining, construction, manufacturing, wholesale trade, and real estate—though officials noted that last year's collection figures were partially depressed by higher refund activity.

Meanwhile, retail trade growth rose 3% from a year ago, tracking slightly below the 3.4% rise in the Consumer Price Index. The largest gains within retail came from electronics and appliance stores and automotive dealers. Restaurant receipts increased by 2.5%, falling short of the inflation rate for food away from home.

Calendar year-to-date sales tax revenue reached $39.6 billion, up 7.8% from the same period in 2025. Sales tax remains the state's largest funding source, accounting for 59% of all tax collections.

Texas also reported revenue figures for other major taxes in September, including:

• Motor vehicle sales and rental taxes: $684 million, up 5%.
• Oil production tax: $507 million, up 14%.
• Motor fuel taxes: $337 million, down 1%.
• Natural gas production tax: $290 million, up 30%.
• Alcoholic beverage taxes: $147 million, down 2%.
• Hotel occupancy tax: $65 million, up 10%.

TexasMoneyEconomy