TML Coronavirus Update

Urgent Updates

How are state tax collections performing in light of the ongoing Coronavirus pandemic?

Still poorly. Yesterday, Comptroller Glenn Hegar announced that October state sales tax collections were $2.72 billion, 3.5 percent less than October of 2019. Total state sales tax collections for the three-month period ending in October were down 5.1% from the same period a year ago. City sales tax numbers will be reported later this month, but they are typically similar to the state’s.

Other state taxes did even worse than sales taxes. Hotel occupancy taxes were down 33.3 percent from a year ago; alcoholic beverage taxes were down 24.2 percent, and oil production taxes were down 42.2 percent.

These ongoing, year-over-year declines will make balancing the next biennial state budget that much more difficult when the Legislature convenes in January.

How will the pandemic impact the Texas economy in 2021, and what does that mean for cities?

As the Comptroller’s October revenue report shows, sales tax revenues have declined as a result of the COVID-related economic slowdown. Even when Texans are back to work, many city budgets will be upside down, with a greater demand for programs and services than money to pay for them. At the live, virtual TML Economic Development Conference on December 10, Deputy Comptroller Lisa Craven will discuss the 2021 state economic forecast, and answer your questions about the effect on cities. Registration is open.

Further Updates

Will there be an Update tomorrow (Wednesday)?

Hopefully not. While the Coronavirus is still very much with us, the volume of significant policy-related news seems to be levelling off. Accordingly, we intend to reduce publication of the Coronavirus Update to Tuesdays and Thursdays only in most weeks. Of course we will make an exception for breaking news, such as new orders by the Governor.

Where can I find archived issues of the TML Coronavirus Updates?

TML Coronavirus Updates are archived by date here and by subject here.