Oklahoma tax revenues dipped in May following a record-setting April, with the latest monthly tax revenue totaling $1.28 billion—a 36% decline from April largely due to the end of tax season. But broader trends in employment, inflation, and consumer spending signal that Oklahoma’s economy remains steady but guarded, mirroring national patterns.
Over the past 12 months, the state collected $16.88 billion in tax revenue, down just 0.3% from the previous year, indicating a stable fiscal base even as certain sectors adjust to tighter monetary policy and shifting demand.
“This month’s numbers reflect the natural downshift after tax season, but the year-long picture shows Oklahoma’s economy holding steady,” said State Treasurer Todd Russ. “Consumers are still spending, sales tax revenues are holding, and manufacturing is showing strength—key signs that support continued resilience.”
Key Takeaways from the May 2025 Tax Revenue Report:
- Gross production tax (oil and gas) increased slightly by 2.1%—a positive sign for the state’s energy sector.
- Sales tax remained the largest single revenue source, signaling that household spending habits are steady, though softening from earlier highs.
- Income tax fell sharply month-over-month (63.2%) as April’s filing surge passed.
- Oklahoma’s Business Conditions Index declined to 50.5, reflecting a possible pause in regional economic expansion.
Ties to National Trends
Across the U.S., states are seeing flattening or slightly declining revenues as the economy cools in response to Federal Reserve interest rate policies and static inflation. Oklahoma is no exception—but remains well-positioned due to its balanced budget requirements and sector diversity.
- Nationally, personal income growth has slowed, and consumer spending is shifting from goods to services.
- Energy-producing states like Oklahoma have seen more revenue volatility but remain relatively strong due to global energy demand and other economic diversity.
- The Federal Reserve has maintained a tight monetary policy, with interest rates expected to hold through Q3 2025, pressuring borrowing, housing and investment across sectors.
For Oklahoma families and small businesses, these numbers reflect both economic stability and caution:
- Steady employment (OK unemployment: 3.2%) and modest inflation (2.3%) help protect purchasing power.
- Sales tax declines may reflect some slowing in retail activity—a signal that households are tightening budgets slightly.
- Manufacturing exports grew 6.4% in Q1, suggesting strength in tradable sectors that support rural and industrial communities.
“Every tax dollar reflects a transaction in someone’s life—purchases, paychecks, energy production,” said Treasurer Russ. “This report shows that while the economy may be easing from its peak, Oklahomans continue to work, spend, and invest making Oklahoma a front runner.”
Access the Full Report
The complete May 2025 Tax Revenue Report is available at treasurer.ok.gov, including breakdowns by tax category, sector, and month
(Editor’s note: This story was provided by the Oklahoma State Treasurer’s Office and printed with minor edits for style.)
