Texas Will Start Taxing Marketplace Seller Fees: Here’s What That Means for You
If you sell products on platforms like Amazon, Etsy, or eBay, your commission fees are about to get more expensive, not because the platform is raising rates, but because Texas is adding sales tax on the fees themselves. Effective October 1, 2025, marketplace commission fees (charged to sellers) will be subject to Texas sales tax. 
This isn’t a small change. It effectively raises your cost of doing business, squeezing margins, especially for side hustles, small shops, and niche sellers across Texas.
What’s Changing
Under the new rule, Texas now classifies marketplace commissions and transaction fees as taxable “data processing services.” That means when a platform charges you a fee for selling, say, a 10% commission on an Etsy sale, it will also collect and remit sales tax on that commission.
This affects anyone selling through marketplace facilitators, which include:
eBay
Etsy
Amazon
Poshmark
Mercari
Facebook Marketplace (for business sellers)
For example, if you sell a handmade candle for $25 on Etsy, and the platform takes a $2.50 commission, it will now also charge roughly 8.25% sales tax on that $2.50 fee, depending on your location.
It sounds small per sale, but across hundreds or thousands of transactions, the added tax compounds quickly.
Why It Matters
Many Texas sellers operate on narrow margins. Adding sales tax to platform fees will increase expenses by 5% to 10% annually for some online retailers.
Those who rely on marketplaces as their main sales channel—particularly artists, vintage resellers, and small-batch product makers—will feel the impact most.
“It’s another layer of cost that small sellers can’t easily pass on,” said Nathan Bernier of Houston Public Media, which first reported the tax change in October 2025. “Larger companies can absorb it. Smaller ones don’t have that cushion.”
What You Can Do
Rather than waiting for higher invoices to surprise you, take a few proactive steps:
Review your current fees.
Log in to your seller dashboard and download a full year of transaction history. Identify what percentage of each sale goes to platform fees.
Adjust your pricing strategy.
If you can’t absorb the extra cost, consider increasing prices slightly or offering bundled discounts that offset the fee.
Consult your accountant.
Update your bookkeeping and forecasting so you can accurately track these new taxable expenses.
Diversify your sales channels.
Consider adding your own online store using Shopify, Square, or WooCommerce. Owning your platform gives you more control over how fees are handled.
Watch for updates from the Texas Comptroller’s Office.
The rule (Texas Administrative Code 3.330) could evolve as feedback comes in from sellers and platforms.
The Bigger Picture
This move fits a larger trend: states expanding their tax base to digital and service transactions. It’s no longer just about taxing goods sold online; it’s about taxing the ecosystem that supports those sales.
For small business owners, it’s a reminder to stay informed. Whether it’s marketplace taxes, credit card surcharges, or changes in data processing laws, every small rule can chip away at profitability if you’re not planning ahead.
The Bottom Line
For Texas small business owners selling online, this new tax isn’t catastrophic, but it’s another reminder that every small shift in policy affects your bottom line. Staying proactive, adjusting your pricing, and maintaining clean financial records can help cushion the impact.
If you’re unsure how this change affects your business, don’t navigate it alone.
At Emerge and Rise, we offer one-on-one support through our Small Business 911 initiative, helping entrepreneurs understand policy updates, taxes, and compliance issues before they become problems.
👉 Need help reviewing your pricing, bookkeeping, or platform strategy? Reach out to us, we’ll help you stay ready and resilient.
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