Sales tax revenue

Businesses in Royse City are showing economic strength, even with the continued COVID-19 situation, as the city recorded a huge boost in sales tax rebate revenue this month.

Businesses in Royse City are showing economic strength, even with the continued COVID-19 situation, as the city recorded a huge boost in sales tax rebate revenue this month.

The city also reported a significant gain in the amount of revenue it collects for the year so far, according to a report issued July 8 by Texas State Comptroller Glenn Hegar.

The July sales tax rebate payment represents the city’s portion of sales taxes collected at local businesses in May and reported to the Comptroller’s office in June.

Hegar said earlier this month that the improvements were noticed following a relaxation of widespread social distancing requirements across much of the state in May.

“The decline in state sales tax collections was driven principally by steep drops in remittances from oil- and gas-related sectors,” Hegar said. “Collections from the construction and amusement service sectors were also sharply down. While collections from restaurants also were depressed, the extent of the decline was checked by increased takeout and delivery sales. Retail trade receipts rose significantly, buoyed by increased online shopping and building material purchases, as business premises were modified for COVID-19 precautions. Retail sales likely also were boosted by increased alcoholic beverage sales at package, grocery and convenience stores. That’s because this category of spending shifted from restaurant and bar on-premise consumption, subject to mixed beverage taxes, to purchases for at-home consumption subject to sales tax. Increased spending by businesses to facilitate teleworking resulted in higher tax collections from vendors of computer hardware and software products.”

Texas Gov. Greg Abbott issued a new executive order June 26, again limiting certain businesses, including bars and restaurants, as part of the state’s effort to contain the spread of COVID-19.

Royse City reported receiving $435,553.18 in sales tax rebate revenue this month, representing an increase of 45.75 percent from the $298,815.79 received in July 2019. For the year to date, the city has taken in $2.6 million, a rise of 24.8 percent from the just under $2.1 million collected through the same point one year earlier.

Sales taxes are one of the two main sources of revenue, along with property taxes, which feed the city’s general fund.

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