Underperforming sales tax revenues still better than expected

Marble Falls, Texas

Fears of a big dip in sales taxes due to COVID-19 didn’t come to fruition in Marble Falls (pictured) and Burnet. File photo

Amid COVID-19 restrictions, shutdowns, and stay-home orders, sales tax revenues have been declining, according to data released by the Texas Comptroller’s Office on June 10.

The city of Marble Falls recorded a 7.25 percent dip in city sales tax revenue compared to last year’s report in June. 

“We were told that it could have been down as much as thirty to forty percent,” said Marble Falls EDC Executive Director Christian Fletcher. “So, to be down 7.25 percent, we were actually pretty pleased with that.”

Year to date, Marble Falls collections are down 0.29 percent from last year.

Marble Falls was insulated to some degree as a regional commerce hub, where big-box retailers were able to remain open through shutdown orders.

“So, we still have people coming in to our big-box retailers, and so our top ten taxpayers are still doing very well,” Fletcher said. “Locally owned, locally operated businesses have been impacted much more negatively than the big boxes that were able to stay open through the various orders. So, it’s good news and bad news, clearly.”

Burnet actually saw a 12.10 percent increase compared to last year’s June report as well as a 7.39 percent increase over the previous year to date. 

“We were hoping it wasn’t going to decline very much, and we felt strongly it wasn’t, but to see it actually climb was a very pleasant unexpected surprise,” Burnet City Manager David Vaughn said. 

The city had anticipated the blow would not be as strong as predicted based on sales at local businesses. 

“Obviously, for a lot of businesses, the sit-down restaurants and the small retail stores, it had a tremendous impact on them,” Vaughn said. “But you saw some of the other stores that remained open exceptionally busy. So, we were very optimistic, and we believed very strongly we were not going to see the massive decline that a lot of people were predicting.”

Vaughn cautioned that sales tax is not the sole indicator of prosperity. For example, EMS services are bringing in little money when compared to this time last year, possibly, in part, because some people lost health insurance due to job loss. 

“When you look at it on the aggregate, and you ask how did the community as a whole do, I think sales tax is somewhat a reflection on that, but it can also be deceiving,” Vaughn said. “While we’re fortunate our sales tax is up, I would not say that was an indication it wasn’t a tremendous impact on the community, because there was.”

Statewide, Texas saw an 11.1 percent decrease in sales tax revenue over the previous year.

alex@thepicayune.com

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