Kyle’s economy considerably stronger than rest of state

 Directly contradicting national and statewide economic indicators in the midst of a global pandemic, Kyle’s economy seems to be stronger than ever.

Mayor Travis Mitchell said today he attributes this fact in large part to Kyle’s proximity to Austin as well as the city’s solid economic foundation and the unprecedented growth in the city’s business sector. Be that as it may, the numbers don’t lie.

While the latest statewide sales tax figures show a revenue decline of 6.3 percent over the same period last year, Kyle’s receipts actually reflect an astounding 19.58 percent increase during that same time.

The state’s economic woes, according to Texas Comptroller Glenn Hegar, can be traced to the under-performing oil and gas sectors because, Hegar said, “well drilling and well completion remain depressed.” But Hegar also added “Receipts from the information sector were also notably down due to the federal ban on sales taxation of internet access service.”

At the same time, the comptroller said, retail trade was the only sector to show any kind of growth. “Increased collections from retail trade reflected continued heightened spending for home improvements in response to the pandemic,” Hegar noted.

Kyle obviously benefits from the fact that its economy is based in large part on retail trade and not on oil, gas or “the information sector.”

Sales tax is the largest source of state funding for the state budget, accounting for 59 percent of all tax collections. In Kyle, however, sales tax revenues account for only 27 percent of collections, according to the FY 2020-21 budget, compared to 30 percent that comes from property taxes.

The Federal Reserve Bank is reporting the nation’s economy is beginning to show signs of improving but “not enough to offset earlier losses, including the 5 percent decline in real GDP at an annual rate in the first quarter, signaling the onset of the 2020 recession.”