Texas Comptroller Don Huffines signed an executive order on September 30 directing his office to remove marketplace and platform fees from the definition of taxable data processing services. If finalized, it ends a tax that has applied to Amazon, eBay, and Etsy seller fees since October 1, 2025.

The tax is still in effect. The order starts a rulemaking process, it does not change anything yet.

How Texas Started Taxing Marketplace Fees in the First Place

Texas has taxed data processing services for decades. The relevant statute dates to 1987.

Under previous Comptroller Glenn Hegar, the agency amended Rule 3.330 effective October 1, 2025, expanding the definition of taxable data processing services to include fees that marketplace platforms charge sellers.

That created the double-tax problem. The same fee gets taxed twice: once as part of the taxable retail sale the platform makes to the customer, and again as a data processing fee the platform charges the seller.

Huffines was blunt about the prior interpretation at the agency's annual briefing, saying the office had “cast a huge net” and calling it “tax invention” rather than tax policy. He noted the statute “was written for a world of mainframes and data-entry workers,” not platforms and apps.

What the Order Would Cover

The proposed change targets marketplace fees tied to online retail, prepared-food and grocery delivery, short-term lodging, ride-hailing, vehicle sharing, pet care, and household services.

For ecommerce sellers specifically, that means seller fees on Amazon, eBay, and Etsy. Restaurant fees on DoorDash, Grubhub, and Uber Eats fall under the same change, as do short-term rental listing fees.

Huffines said business owners told him the tax “puts Texas sellers at a disadvantage against out-of-state competitors who don't pay it.” That framing matters for anyone modeling whether to incorporate or warehouse in Texas.

Nothing Changes Until the Rulemaking Finishes

This is the part to be precise about before adjusting any tax position.

The executive order does not amend Rule 3.330. The comptroller will file a proposed amendment with the Texas secretary of state for publication in the Texas Register, followed by a 30-day public comment period.

Until final adoption, the data processing tax continues to apply to covered marketplace fees. A seller who stops accruing it on the strength of the announcement is exposed for the gap period.

The order also does not eliminate the broader data processing tax. Computer-based data storage, web hosting, and website maintenance remain taxable, along with the existing 20% exemption on qualifying data processing charges.

What Texas Sellers Should Do Now

Review how marketplace fees are currently being taxed on your account. Platforms handle this differently, and some separate the fee tax on invoices while others fold it into a blended charge.

Check your contracts and platform terms for provisions addressing who bears tax obligations on fees. If the rule changes, you want to know whether a refund or credit flows to you automatically or requires a claim.

Then watch the Texas Register for publication and note the comment period dates. The comptroller's office has invited comments, and sellers affected by the tax have a direct window to respond.

Huffines also said his office will continue reviewing how the data processing tax is interpreted and may propose additional changes. For any Texas seller paying tax on digital services beyond marketplace fees, that is worth tracking.