For the past several weeks, the comptroller has been referring to the state of the economy as a recession. The latest sales tax figures give the first glimpse of how much the economic downturn will hurt the state budget.
Texas collected $2.58 billion in state sales tax revenue in April — a roughly 9% drop from what the state collected the same month last year, Comptroller Glenn Hegar announced Friday. That drop, from $2.8 billion to $2.58 billion, marked the steepest decline since January 2010, Hegar said.
April’s revenue, which the state collected from purchases made in March, is among the first official glimpses at the dramatic blows state and local budgets will take from widespread social distancing measures first taken last month to stop the spread of the new coronavirus. And Hegar warned that the state’s largest single source of funding will continue to “show steeper declines” in the coming months compared with a year ago as the economy continues what will likely be a slow crawl out of a weeks long virtual shutdown due to the pandemic.
Friday’s announcement was not entirely unexpected. For the past several weeks, Hegar has been referring to the state of the economy as a recession both in private talks with state lawmakers and in interviews.
Parts of the economy have been given the green light to reopen under certain restrictions, but it is unclear how quickly businesses will recover and return to normal business operations, which feed into the state’s sales tax revenue.
For more information: TheTexasTribuneThe texas Tribune
by: cassandra pollock
May 1, 2020