Monthly update: sales tax

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Sales and use taxes in the 121 Houston-area cities that collect the tax totaled $696.6 million in the first quarter of 2024, up 0.2% from $695.5 million collected in the first quarter of 2023. Adjusted for inflation, collections are however down 3.5 percent.

The collections are an indicator of the economic activity of the region. Businesses and consumers pay sales taxes on their purchases, and the pace of collections tends to follow the economic cycle. The recent drop in collections (after adjusting for inflation) suggests some weakness in the local economy.
Among the 32 cities in the metro area that typically receive $500,000 or more in taxes each month, activity is down in 19 cities after adjusting for inflation, flat in two and up in 11. These 32 cities represent 79.9 percent of all sales taxes. collections in the region.

The Texas Comptroller of Public Accounts publishes allocated payments from sales and use tax monthly. There is a two-month delay between when the tax is collected and when it is distributed. Data from January to April will be released in June.

Prepared by the Greater Houston Partnership Research Division

Patrick Jankowski
Chief Economist
Senior Vice President, Research
[email protected]

Léta Wauson
Research Director
[email protected]