Texas Comptroller Glenn Hegar announced that state sales tax revenue reached $3.8 billion in February, marking a 4.3% increase compared to February 2024. This growth follows a strong January and exceeds the general rate of price inflation.

"State sales tax collections exhibited solid growth compared with February 2024," Hegar said. He noted mixed results from sectors driven by business spending, with construction and wholesale trade sectors slightly down, while manufacturing showed the largest year-over-year increase in two years. The information sector also saw significant growth due to computer and data processing services.

Retail trade sector remittances grew slightly, though sporting goods, electronics and appliance, and general merchandise stores experienced significant declines. In contrast, home improvement store collections rose significantly after a weak previous month. Restaurant receipts increased slightly but remained below the inflation rate for food away from home in January.

For the three months ending in February 2025, total sales tax revenue was up 4% compared to the same period last year. Sales tax remains the largest source of state funding, accounting for 58% of all tax collections.

Texas also collected revenue from other major taxes: motor vehicle sales and rental taxes totaled $650 million (up 11%), motor fuel taxes were $310 million (up 2%), oil production tax was $486 million (up 6%), natural gas production tax was $221 million (up 19%), hotel occupancy tax was $57 million (down 2%), and alcoholic beverage taxes were $128 million (down less than 1%).

Further details on monthly collections can be found on the Comptroller’s Monthly State Revenue Watch website. An extensive history of tax policy developments is available in the "Sources of Revenue" publication.

Information from this article can be found here.