Texas collected $4.8 billion in net state sales tax revenue in October, up 13.3% from a year earlier, Comptroller Don Huffines announced Monday.
Construction and manufacturing led the increase, while restaurant tax remittances grew much more slowly.
The November 2 figures came one day before Huffines, the Republican incumbent appointed to the position this summer, faces three challengers in Tuesday’s statewide election.
Business Spending Drives The Gains
Sales tax remittances from construction rose 38% from October 2025, and manufacturing receipts climbed 33%. The comptroller’s report said the broad gains could reflect large projects, including data centers. Sales tax receipts from retail trade increased 11%, helped by electronics, appliance stores, and online shopping.
Restaurant remittances increased 2.3%, below the inflation rate for food away from home, the agency said. The collections mainly reflect purchases made in September and reported by monthly filers in October; they are not a direct tally of October retail spending.
The $4.8 billion figure represents net collections after refunds, overpayment credits, and prepayment adjustments, according to the comptroller’s release. It should not be interpreted as total taxable sales in Texas during October.
For the calendar year through October, net state sales tax revenue totaled $44.4 billion, 8.4% above the same period in 2025. Sales tax generated 59% of Texas tax collections in fiscal 2026, according to the comptroller.
Comptroller Is On Tuesday’s Ballot
Gov. Greg Abbott appointed Huffines earlier this year, and he was sworn in on August 1. A former Texas state senator and Dallas-area real estate developer, Huffines is seeking a full four-year term as comptroller.
The Texas Secretary of State’s certified ballot lists Huffines (R), state Sen. Sarah Eckhardt (D-Austin), V. Alonzo Echavarria-Garza (Libertarian), and Shehla Faizi (Green). Election Day is Tuesday, November 3, 2026.
The comptroller oversees state tax collections and prepares revenue estimates used in budgeting. The office also administers other financial programs.
Will Higher Sales Taxes Lead To Property-Tax Relief?
“October’s strong sales tax collections are encouraging and reflect continued economic growth across key sectors of the Texas economy,” Huffines said in the official announcement. “These healthy collections provide lawmakers with an opportunity during the next legislative session to continue making property tax relief a top priority and help Texans keep more of their hard-earned money.”
Legislative decisions, budget commitments, and future collections will determine whether the higher receipts support tax relief. Huffines also called for dedicating surplus sales tax revenue to property-tax reductions in his September fiscal-year report.
Could Higher Sales Tax Revenue Help Raise The Homestead Exemption To $200,000?
Texas collected $4.8 billion in net state sales tax revenue in October, raising a question for homeowners: Could stronger collections help lawmakers increase the school district homestead exemption on primary residences to $200,000?
Comptroller Don Huffines said Monday that the revenue growth creates an opportunity for additional property-tax relief.
Texas currently provides a $140,000 exemption from school district property taxes for qualifying primary residences. Voters approved the increase from $100,000 in November 2025, extending a series of property-tax reductions adopted in recent years.
Increasing the general exemption to $200,000 would exclude an additional $60,000 of a qualifying home’s value from school district taxation. For example, a home with a taxable value before exemptions of $300,000 would have $100,000 remaining subject to school district taxes, compared with $160,000 under the current exemption, assuming no other adjustments or exemptions. The Texas Tax Code establishes how the exemption reduces a home’s taxable value.
Actual savings would depend on the school district’s adopted tax rate.
At a hypothetical rate of $1 per $100 of taxable value, the additional $60,000 exemption would save a qualifying homeowner approximately $600 annually. The higher exemption would not automatically reduce city, county, or special district taxes, which operate under separate provisions.
Texas already provides an additional $60,000 school district exemption for homeowners who are at least 65 years old or have qualifying disabilities. Combined with the general $140,000 exemption, eligible homeowners currently receive $200,000 in exempt value. Lawmakers would need to determine whether that additional exemption would remain unchanged if the general exemption increased, potentially bringing the combined amount to $260,000. The current amounts are established in Section 11.13 of the Texas Tax Code.
Huffines has previously advocated using stronger state revenue to reduce property taxes. In his September 11 revenue report, he urged lawmakers to dedicate surplus sales tax collections to lowering the cost of homeownership.
However, neither that announcement nor Monday’s report proposes increasing the general exemption to $200,000. That amount represents a potential policy change, not an enacted increase or a specific proposal announced by Huffines.
Because the $140,000 general exemption is established in the Texas Constitution, increasing it to $200,000 would require a constitutional amendment approved by voters. Lawmakers would also need to address the reduction in school district property-tax collections and determine how much replacement funding the state would provide, as it did through Senate Bill 4 in 2025.
The latest sales tax figures provide additional information for that debate. Whether the growth translates into a larger homestead exemption will depend on future revenue estimates, legislative decisions, voter approval, and the state’s other spending obligations.
Provided by Dallas Express
