San Antonio Sales Tax Revenue Dropped 10% in August
A lower city sales tax rate led to reduced collections for San Antonio in August 2026.
Updated on Oct. 4, 2026 in Employment
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San Antonio sales tax collections fell by 10% in August 2026 compared to the same month last year, totaling $37 million. The decline follows a reduction in the city's local sales tax rate earlier this year.
Why it matters
The drop in revenue for city coffers stems directly from the adjusted tax rate of 1.125%, which took effect on January 1, 2026. While August collections decreased locally, the broader Texas statewide sales tax revenue grew by 11.5% during September 2026.
San Antonio collected $37 million in sales tax revenue for August, marking a 10% decrease compared to August 2025. This compares to a 2% increase observed in July 2026, even as the local unemployment rate reached 4.7%.
The players
Texas Comptroller
The state agency responsible for collecting sales taxes on behalf of cities and returning the funds to local jurisdictions.
The details
The city's sales tax revenue declined because the local tax rate was lowered from 1.250% to 1.125% starting January 1, 2026. Although specific taxable categories like retail trade and restaurant receipts saw increases of 3% and 2.5% respectively in August, the lower collection rate outweighed these gains. The Texas Comptroller handles these collections on behalf of the city before returning the funds to local jurisdictions.
Timeline
January 1, 2026: San Antonio sales tax rate dropped to 1.125%.
July 2026: San Antonio sales tax collections rose 2%.
August 2026: San Antonio sales tax collections dropped 10%.
September 2026: Texas statewide sales tax revenue totaled $4.4 billion.
Money Landscape
While statewide sales tax revenue across Texas remains robust with year-to-date totals reaching $39.6 billion, San Antonio is experiencing a localized dip. This shift highlights how municipal tax rate adjustments can cause temporary revenue volatility against a stronger state-level trend.
The change in city tax rates does not directly alter consumer prices, but it reflects a shift in how municipal services are funded. Residents should consult with a qualified financial or tax professional if they have questions regarding how local tax policy influences the broader city budget.
The takeaway
The August revenue decline in San Antonio is a mechanical result of the city's lower tax rate rather than an economic downturn in retail or dining. Homeowners can track city budget hearings to see how these tax collections influence future local service funding and public projects.
Further reading
For broader trends affecting the regional economy, visit Employment.
Source note: This article includes information reported by Texas Public Radio.
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