Oklahoma State Treasurer Todd Russ released figures this week showing what he called a “seasonal dip” in the state’s monthly revenue for August and it included a nearly 32% drop in revenue from the gross production tax on oil and gas.
At the same time, Russ pointed out that the August 2025 State Tax Revenue Report also indicated the state had “continued steadiness in long-term revenues.”
The oil and gas gross production tax revenue, he explained, fell 31.9% from July, something he attributed to “reflecting energy market volatility.” Despite the decline from July to August, the gross production tax revenue grew 2.3% compared to a year earlier.
“Every tax dollar reflects a real piece of economic activity— paychecks to energy production,” Russ said.
Total collections from all sources of tax revenue over the past 12 months reached $16.97 billion, up slightly by 0.1% from the previous year.
“As a seasonal slowdown occurs, manufacturing exports continue to trend higher showing signs Oklahoma’s economic base remains steady,” said Treasurer Russ. “As we move into the fall, our state appears to be well-positioned to navigate national headwinds with a balanced budget and resilient economy.”
Key Takeaways from the August 2025 Tax Revenue Report
- Income Tax: Fell 17.5% month-over-month but rose 5.1% compared to August 2024, showing underlying stability.
- Sales & Use Tax: Edged up 0.3% from July, reaching $594.9 million, though down 1.8% from last year.
- Gross Production Tax (oil & gas): Dropped 31.9% from July, reflecting energy market volatility, but grew 2.3% year-over-year.
- Motor Vehicle Tax: Declined 9.3% month-over-month and 10.7% year-over-year, reflecting weaker auto sales activity.
- Other Sources: Down 7.3% from July, reflecting softness across more than 70 smaller revenue streams.
- Oklahoma’s Business Conditions Index: Rose slightly to 50.3, signaling modest regional growth.
- Manufacturing Exports: Up 4.5% year-to-date, reaching $3.5 billion in the first half of 2025 compared to $3.3 billion in 2024.
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Ties to National Trends
Across the U.S., states are seeing mixed revenue performance as the economy adjusts to spotty but persistent inflation (2.7%) and elevated interest rates maintained by the Federal Reserve. Consumer spending has cooled in some sectors, and national employment growth is moderating. Finally, something the Feds have been waiting to see.
- National unemployment held at 4.2%, while Oklahoma remains well below, at 3.1%, underscoring continued local job market strength.
- Energy markets remain volatile, affecting producing states like Oklahoma, though longer-term demand continues to provide support.
- Manufacturing activity nationwide has slowed, but Oklahoma exports continue to grow, reinforcing the state’s sector diversity.
- With inflation easing and economic activity slowing, analysts expect the Federal Reserve will consider an interest rate adjustment in the months ahead, a move that could influence both state revenues and household budgets.
“Every tax dollar reflects a real piece of economic activity—from paychecks to energy production,” Russ added. “Even as monthly numbers fluctuate, Oklahoma families and businesses are continuing to fuel long-term stability for our state.”
The complete August 2025 Tax Revenue Report is available at treasurer.ok.gov, including breakdowns by tax category, sector, and month.