Texas published its proposal on October 16 to stop taxing marketplace seller fees, and the earliest it can take effect is November 15.
If you sell on Amazon, eBay, Etsy or Walmart next to your own store, this matters because platforms have been applying Texas data processing tax to the fees you pay them since October 1, 2025. For an Ecommerce Paradise reader running a high-ticket store with a marketplace channel on the side, the proposal is a possible margin fix. It also comes with a comment window, open questions on refunds, and one rule that has not changed: the tax still applies today.
I covered the September 30 executive order in my first breakdown of the Texas marketplace fee tax. This post covers what is new: the actual rule text, the state’s own revenue estimates, and what to do before the earliest adoption date. If you are still deciding what to sell, my guide to high-ticket dropshipping explains why the channel mix matters this much.
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Texas Rule 3.330 Proposal Strikes the Marketplace Fee Tax
The October 16, 2026 issue of the Texas Register carries the Comptroller’s proposed amendment to 34 TAC §3.330, the data processing services rule. The proposal deletes subsection (b)(5), which reads “Effective October 1, 2025, marketplace provider services may be included in taxable data processing services.” It then renumbers the paragraphs that follow.
In its place the proposal adds a new subsection (j), titled “Platforms and Platform Provider facilitation fees.” Under paragraph (2), a fee, commission or other charge that a platform provider imposes on a platform seller is not a taxable data processing service or a taxable information service. Paragraph (3) lists affected industries, including short-term lodging, ride-hailing and grocery delivery.
The timing language is specific. According to the proposal, the Comptroller must receive comments “no later than 30 days from the date of publication.” The interpretation in subsection (j) “becomes effective on the date this amendment is adopted,” and the earliest possible adoption date is November 15, 2026. The Comptroller says the final rule may differ from what was proposed, per Value Added Resource’s coverage of the filing.
The proposal also carries the state’s own price tag. Fiscal notes in the filing show a general revenue loss of $17.92 million in fiscal 2027, rising to $25.18 million by fiscal 2032. Local governments lose $5.18 million in fiscal 2027, rising to $7.28 million by fiscal 2032. Adding the two lines gives about $23.1 million in fiscal 2027 and $32.46 million in fiscal 2032, and those figures cover other platform services beyond online marketplaces.
The proposal grew out of an executive order signed September 30 by Comptroller Don Huffines, who took office August 1, 2026. In the Comptroller’s announcement, Huffines said, “For the past year, small business owners across this state have been getting hit by a hidden tax nobody voted for.” He also called the prior approach “tax invention,” not tax policy.
Two things have not changed. Per Avalara, the existing tax continues to apply until the amendment is adopted, so platforms keep deducting it. And the proposal does not say whether sellers get any of it back, a gap noted by both Value Added Resource and Foley & Lardner.
How Texas Came to Tax Marketplace Fees in October 2025
Texas has taxed data processing services since 1987, and 20 percent of each charge is exempt, which means the tax generally lands on 80 percent of the fee. That is the baseline for every number in this post. The state rate is 6.25 percent and local rates can add up to 2 points, for a combined maximum of 8.25 percent, as I laid out in my earlier post.
Under former Comptroller Glenn Hegar, an amendment to Rule 3.330 effective October 1, 2025 extended that tax to marketplace provider services. Hegar’s position, per Texas Policy Research, was that two separate purchases were taking place: the customer buying from the seller, and the seller buying marketplace services from the platform. Critics called that a double tax.
The platforms moved at different speeds, per Value Added Resource. Poshmark told Texas sellers it would deduct sales tax on its commissions starting October 1, 2025. Etsy updated its Payments Policy in December to allow tax collection on seller fees where applicable. eBay gave no specific advance notice, and sellers found the charges in their records before eBay documented Store subscriptions, insertion fees and Final Value Fees as taxable.
This was not the first attempt to settle the question. Lawmakers declined to approve legislation exempting marketplace fees in 2023, according to Value Added Resource. The Texas Taxpayers and Research Association and other groups opposed the 2025 amendments, arguing they expanded the tax base without authority, per Holland & Knight.
The counterpoint is worth stating plainly. Avalara’s Scott Peterson, vice president of government relations, noted that repealing the rule would not necessarily resolve whether marketplaces provide data processing services at all. Holland & Knight adds that the order covers only marketplace and platform fees. It does not address software as a service, cloud computing or AI-powered services, and Huffines said his office may propose more changes. So this is a narrow fix, not a general retreat on the tax.
What the Texas Fee Tax Reversal Means for Your Store
My read: this is a small win with a large unknown attached, and the unknown is refunds. The proposal fixes the tax going forward from the adoption date. It says nothing I can find about the roughly 13 months of tax already deducted from seller payouts, and the platforms collected and remitted it, so any refund claim would start with them, not with you.
Here is the rough math, and it is hypothetical, not a reported figure. Say you pay $15,000 a month in marketplace fees across Amazon, eBay and Etsy on Texas-sourced sales. Eighty percent of that is $12,000. At the 8.25 percent maximum combined rate, the tax is $990 a month, or $11,880 a year. At $4,000 in monthly fees, the same formula gives $264 a month, or $3,168 a year. Your local rate may be lower, so treat these as ceilings.
That produces three practical thresholds. Under about $1,000 a month in marketplace fees, the tax is roughly $66 a month and not worth a spreadsheet. Between $1,000 and $5,000, it is worth tracking and worth a line in your margin model. Above $5,000, you are looking at $330 or more a month and you should know exactly which platform deducts what, because a refund path, if one appears, will be easier to claim with clean records. The operating cost breakdown I wrote for growing stores shows where else that money tends to leak.
Most high-ticket dropshippers I teach run their own Shopify store as the main channel, and for them this proposal is a footnote. Your largest fee is payment processing, and nothing I read in the filing or in the coverage addresses processing fees. The filing defines “platform” and “platform seller” for marketplace-style businesses. I have not seen a ruling on whether a hosted storefront subscription counts, so I will not guess. Check your own Shopify invoice for a Texas tax line. Then compare it against what I covered in the Shopify Tax change on return shipping fees.
Where it does matter is the marketplace overflow channel. If you list your suppliers’ furniture, fitness or outdoor gear on Amazon or Walmart to catch extra volume, every fee line is now a tax line in Texas. Add the 24-month sales tax lookback for remote sellers to the picture. Then add the tighter listing monitoring in eBay’s AI monitoring change, and marketplaces look more like a compliance project than a free sales channel.
Treat November 15 as the earliest date, not the expected one. It falls on a Sunday, the Comptroller has said the final rule may differ from the proposal, and heavy comment volume could push adoption later. I would plan for a mid-to-late November adoption at best and a December slip as a real possibility, and I would not price a single listing around a tax that has not yet been repealed.
Bookkeeping is where this gets solved or ignored. Finaloop is built for ecommerce books and can split marketplace payouts into sales, fees and tax so the Texas deduction shows up as its own line. A2X does similar payout splitting for marketplace sellers.
If you run the books in QuickBooks, add a sync tool on top. Synder handles that job.
Simpler setups can start with FreshBooks.
For pricing and limits across the rest of the field, my Xero alternatives comparison covers it.
One more angle. The processors and platforms you pick decide how much of this you ever see. My comparison of payment processors for small business is the place to start if you want fewer middlemen taking a cut.
And if you would rather skip the channel juggling, my team can build and run the store for you through the turnkey done-for-you service, so you are not stitching together channels and tax lines yourself. If you source from distributors, Inventory Source is one way I connect supplier feeds to a store.
Not sure which of your marketplace fees are carrying Texas tax, or whether the marketplace channel is still worth it? Bring your fee statements and we will work through it 1-on-1. Get the coaching details →
Five Steps Before Texas Can Adopt on November 15
None of this requires you to change how you collect or pay today. It requires you to be ready on the day the rule moves.
- Pull 12 months of fee statements from every marketplace you use and add up the Texas tax lines. Start with Etsy, eBay and Poshmark, since Value Added Resource reports those three told or showed sellers about the charge, then check Amazon and Walmart payout reports for the same deduction.
- Keep paying. Per Avalara, the current tax applies until the amendment is adopted, so nothing about your payouts changes before then. Do not adjust your own filings on the strength of a proposal.
- Decide whether to file a comment. The Texas Register notice lists where to send comments, and the main open question is whether relief reaches fees already paid. A short comment from an actual seller with real numbers carries weight, and Holland & Knight specifically suggests commenting on retroactivity.
- Rebuild your marketplace margins with and without the tax. Use the 80 percent and 8.25 percent figures as a ceiling, then replace them with your actual local rate. If a product only works without the tax, you will know which listings to watch in November.
- Put November 16 on your calendar and check whether Texas adopted the rule as proposed. If you want a second set of eyes on your channel mix, you can book a discovery call and we will go through it.
If you are still choosing what to sell, my high-ticket niches list is the place to start. My first-year budget for a high-ticket store shows what fees to expect before you pick a channel. I am not a tax or legal advisor, so run the numbers by your CPA before you act on any of it.
Frequently Asked Questions
Is the Texas marketplace fee tax gone?
No. It is a proposal published October 16, and Avalara reports that the existing tax stays in place until the amendment is adopted. The earliest adoption date in the filing is November 15, 2026.
How much tax is actually on a marketplace fee in Texas?
Generally 80 percent of the fee is taxable because 20 percent of data processing charges is exempt. The state rate is 6.25 percent plus up to 2 points of local tax, as I explained in my earlier Texas post.
Will sellers get refunds for tax already paid?
Unknown. The proposal does not address refunds or retroactivity. Eversheds Sutherland notes that a marketplace provider that paid tax on its fees may have a refund opportunity, with claims generally due within four years, so ask each platform what it plans to do.
Does this cover Shopify, payment processor or app fees?
Nothing in the filing or the coverage I read says so. The new language is written around platform providers and platform sellers. Check your invoices, and see my Stripe alternatives comparison if you are reviewing processing costs.
Do I need a Texas sales tax account to sell there?
That depends on your nexus, and it is separate from this proposal. Marketplaces like Amazon and Walmart collect on your behalf in many states, but your own storefront sales can create filing duties, so confirm with a CPA.
Where do I start if marketplace fees are eating my margin?
Rethink the product mix. My free niches list at the high-ticket niches download shows categories where your own site can carry most of the volume.
Already running a store that works and want my team to scale it past the marketplace fee drag? See the scaling service →
I will keep watching the Texas Register for the adoption notice. Subscribe to the YouTube channel for daily breakdowns. More breaking news coming through the day.
Related Articles
If this was useful, these go deeper:
- Texas Moves to Drop Sales Tax on Marketplace Fees
- Sales Tax Board Backs 24-Month Lookback for Remote Sellers
- Shopify Tax Adds Sales Tax to US Return Shipping Fees Oct. 23
- Temu’s $3M Texas Deal Sets Product Safety Rules for Sellers
- Amazon Sellers Get 7 Days to Send Prepaid Return Labels
Trevor Fenner is an ecommerce entrepreneur and world traveler from Seattle, Washington, and the founder of Ecommerce Paradise, a platform focused on helping entrepreneurs build and scale profitable high-ticket ecommerce and dropshipping businesses. With over a decade of hands-on experience, Trevor specializes in high-ticket dropshipping strategy, niche and product selection, supplier recruiting and onboarding, Google & Bing Shopping ads, ecommerce SEO, and systems-driven automation and scaling. Through Ecommerce Paradise, he provides free education via in-depth guides like How to Start High-Ticket Dropshipping, advanced training through the High-Ticket Dropshipping Masterclass, and fully done-for-you turnkey ecommerce services for entrepreneurs who want a faster, more hands-off path to growth. Trevor is known for emphasizing sustainable, real-world ecommerce models over hype-driven tactics, helping store owners build scalable, sellable, and location-independent brands.
He maintains homes in Seattle and Bali, spends most of the year overseas, and usually returns to Seattle for about a month each summer.
