State sales tax revenue down

State sales tax revenue totaled $3.68 billion in March based on February sales, 2.7 percent less than in March 2024, according to Texas Comptroller Glenn Hegar.

“State sales tax collections declined on a yearover-year basis for the first time since April 2024,” Hegar said. “Collections were down in all major business-related sectors as well as the retail sector, responsible for the largest share of sales tax revenue.”

In Limestone County cities, both decreases and gains were seen. Mexia dropped 7.38 percent with $254,183 compared to $274,445 in March 2024; Groesbeck rose 9.77 percent with $92,624 compared to $84,380; Coolidge gained 2.19 percent with $3,494 compared to 3,418; Kosse fell 4.36 percent with $11,636 compared to $12,168 and Thornton increased 39.02 percent with $4,207 compared to $3,026.

“Among the major sectors driven mainly by business spending, the construction, manufacturing and wholesale trade sectors all saw decreases, with receipts from the construction sector falling by double digits compared with March 2024, Hegar said. “Remittances from the wholesale trade sector were down significantly, while collections from the manufacturing sector were down moderately. Receipts from the information sector were up again in March, driven once more by computer and data processing services.

“Remittances from the consumer-driven retail trade sector fell compared with last March, with nearly all subsectors coming in below their March 2024 totals. Remittances from grocery stores were essentially flat compared with last March, and collections from electronic shopping were up slightly.

“Receipts from restaurants increased from a year ago, but below the rate of infl ation for food away from home for February.”

Total sales tax revenue for the three months ending in March 2025 was up 2.8 percent compared with the same period a year ago. Sales tax is the largest source of state funding for the state budget, accounting for 58 percent of all tax collections.

Texas collected the following revenue from other major taxes: motor vehicle sales and rental taxes — $541 million, up 35 percent from March 2024; motor fuel taxes — $293 million, down 3 percent from March 2024; oil production tax — $425 million, down 10 percent from March 2024; natural gas production tax — $288 million, up 36 percent from March 2024; hotel occupancy tax — $58 million, down 8 percent from March 2024; and alcoholic beverage taxes — $138 million, down 1 percent from March 2024.