In Comptroller Glenn Hegar’s Tax Exemptions and Tax Incidence report, for fiscal 2021, aggregate exemptions for the revenue sources included in this report will total an estimated $58.6 billion. Of this amount, the exemptions related to state taxes will account for $44.5 billion; school property tax exemptions will account for the remaining $14.1 billion. Hegar points out that a significant share of total exemptions, $14.3 billion of the estimated fiscal 2021 amounts, is accounted for by exemptions to the sales tax for items that are taxable under other law. Included among the items taxed under other law are insurance premiums, motor vehicle sales and motor fuels; their consequent exemptions from the sales tax are estimated to be worth $7.6 billion, $3.7 billion and $2.5 billion, respectively.

Other exemptions from the sales tax include $7.2 billion in raw materials used in manufacturing, $3.3 billion in food for home consumption (essentially, groceries) and $1 billion worth of over-the-counter drugs and prescription medicine and devices. This report also presents the results of the analysis prepared in accordance with Section 403.0141, TGC.