New Texas Sales Tax Hits Online Sellers This October

(KNUE-FM) Life is always changing, and lately it seems like everything continues to get more expensive not only here in Texas but across the country. And now that we are in the month of October there is something new that you may be taxed on.

What Platforms Are Affected?

According to KVUE, As of October 1, any Texans who sell goods online on the platforms eBay, Poshmark, and Etsy will have to start paying a sales tax on marketplace fees.

The change is being made after former Comptroller Glenn Hegar reclassified online marketplaces as data processing services which are considered taxable.

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What This Means for Online Shops

As you would expect, people who are selling goods online are not too happy about this. Sellers are already paying listing and commission fees to those websites, so the new sales tax is just another thing eating into profits. But the new tax is only on the fees, not on the items sold on the different marketplaces. Of course, buyers are already paying sales tax on any purchases they make.

Currently in Texas, sellers get a 20% exemption on data processing charges which can still have sales tax added up to 8.25%.

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It’s tough to hear about any more taxes as inflation is hitting everyone in the wallet right now. You just feel for those that are trying to get creative to bring in more money, but now they have a new expense that will need to be paid.

If you have a shop online, I would highly encourage you to try not to be discouraged by this new tax. You have built something great, don’t let another hurdle get in the way of you becoming successful.