AUSTIN (June 6, 2012)--The Texas Comptroller reported Wednesday that the state collected more than $2 billion in May, marking 26 straight months of sales tax growth.

The total released Wednesday is a 7 percent increase over last year.

The state distributed $514 million to local governments the comptroller’s office said.

Sales taxes are the state's largest source of income.

Comptroller Susan Combs said the oil and gas industry continue to be a major contributor to sales tax growth, but said that restaurants are also doing well as the economy continues to recover.

The state's tax revenues are higher than forecast, but still not enough to cover an expected $4 billion budget deficit next year.

On Tuesday Gov. Rick Perry asked state agencies to be prepared for 10 percent cuts when the Legislature meets again next year.