State sales tax revenue totaled $2.5 billion in February, with an additional $167 million from March 1 activity

AUSTIN — The majority of February sales tax revenue is based on sales made in January and remitted to the agency in February. For this period, however, the Feb. 22 due date for state taxes and fees to be reported and paid was extended by one week, due to effects of the winter storm, to March 1.

Texas Comptroller Glenn Hegar today said state sales tax revenue totaled $2.51 billion in February, 13.3 percent less than in February 2020; however, after adjusting the February totals to account for March 1 activity, February sales tax revenue totaled $2.68 billion, down 7.5 percent from February 2020.

“The pattern in sales tax collections we’ve seen for the past several months continued, with receipts from the retail trade sector showing gains over the prior year while receipts from oil- and gas-related sectors show deep declines,” Hegar said. “Receipts from the service sector, as well as from restaurants and bars, also remain down significantly as many of these businesses had occupancy restrictions or were required to be shuttered during the COVID-19 pandemic.

“Sales tax collections from the mining, construction, manufacturing, wholesale trade and equipment leasing sectors continue to be depressed. Much of the sales in these sectors are tied to oil and gas drilling activity, which has picked up some since the downturn last spring but remains well below what it was a year ago.

“Receipts from online, sporting goods, furniture, and home improvement retailers continue to be elevated, a trend apparent since the start of the pandemic as Texans spend more time at home.”

Total sales tax revenue for the three months ending in February 2021, after adjusting for March 1 activity, was down 4.2 percent compared to the same period a year ago.

Sales tax is the largest source of state funding for the state budget, accounting for 59 percent of all tax collections.

The effects of the COVID-19 pandemic continued to be evident in some sources of revenue in February 2021.