Net state sales tax revenue totals $4.8 billion in October

October’s net state sales tax revenue exceeded the same time last year by 13.3 percent with total collections hitting $4.8 billion for the month.
“October’s strong sales tax collections are encouraging and reflect continued economic growth across key sectors of the Texas economy,” the Texas Comptroller’s Office reported.
Sales tax revenue increased by double digits in October compared with the same month a year ago for the second straight month, the first time that has occurred since the months coming out of the government lockdowns after the COVID pandemic. Remittances from sectors driven primarily by business spending showed the largest increases, and retail trade, the largest sector, was up 11 percent.
Collections from the construction and manufacturing sectors were up 38 and 33 percent, respectively, from October 2025. The gains were spread across subsectors of both industries and may reflect investment in large-scale projects, including data centers, in September. Sales tax remittances from the oil and gas mining sector decreased almost 12 percent from October 2025.
Among the sectors affected mainly by consumer spending, the retail trade and services sectors were both up significantly last month. Receipts from the retail trade sector increased by 11 percent, driven mainly by increased remittances from electronics and appliance stores and online shopping.
Receipts from restaurants increased 2.3%, below the rate of inflation for food away from home.
Net revenue reflects sales tax collections after refunds, overpayment credits and prepayment adjustments. These collections come mostly from businesses that report tax monthly and reflect their September sales. Businesses that report quarterly or annually remit on a different schedule.
Calendar year-to-date net state sales tax revenue was $44.4 billion, up 8.4 percent compared with the same period a year ago. Sales tax is the largest source of state tax revenue, accounting for 59 percent of all tax collections in fiscal 2026.
Total All Funds revenue was $14.3 billion in October, down 8.1 percent from October 2025. The decline reflects a one-time toll-related payment of $1.75 billion received in October 2025; excluding that payment, All Funds revenue was up 3.5 percent from a year prior.
Texas collected $6.9 billion in All Funds tax revenue in October, up 7.1 percent from October 2025. Revenue from other major taxes included:
• motor vehicle sales and rental taxes: $690 million, down 1 percent from October 2025;
• motor fuel taxes: $332 million, down less than 1 percent from October 2025;
• oil production tax: $634 million, up 56 percent from October 2025;
• natural gas production tax: $50 million, down 78 percent from October 2025;
• hotel occupancy tax: $51 million, down 21 percent from October 2025; and
• alcoholic beverage taxes: $133 million, down 8 percent from October 2025.