Texas May Stop Taxing Your Delivery App Fees, and Restaurant Operators Should Get Ready Now
By Hari Nathan Kalyan, Managing Attorney, Warren Kalyan.
Five Key Takeaways
- The Comptroller wants to end the double tax on delivery app fees. On September 30, 2026, Comptroller Don Huffines ordered his office to propose an amendment to Rule 3.330 that would take marketplace and platform fees out of taxable data processing services.
- It is a directive, not a new rule. The proposal still has to be filed, published in the Texas Register, and open for a 30 day comment period. The current rule stays in effect until an amendment is adopted.
- Prepared food delivery and short term lodging are both on the list. Restaurants, bars, hotels, and rental operators who sell through apps and booking platforms should pay attention.
- Refunds and retroactivity are unknown. Nothing we reviewed says whether relief will reach past periods. Keep collecting and remitting under the current rule.
- Get ready now. Read your platform statements, organize your records, review your platform agreements, plan a short comment, and address the issue in deals and leases.
If you run a restaurant, bar, or hotel in Texas, look at your last delivery app statement. Somewhere in that pile of commissions, marketing fees, and service charges, you may be paying sales tax on the platform's fee. And you may already be paying sales tax on the meal itself. That is the double tax the Texas Comptroller now says he wants to end.
Why It Matters
Delivery apps take a real bite out of thin restaurant margins. Commissions are already steep. A second layer of tax on top of those fees hits operators who can least afford it. If the rule changes, the savings could be meaningful. If you wait to pay attention, you could miss a chance to protect them.
What Happened
On September 30, 2026, Texas Comptroller Don Huffines signed an executive order directing his office to propose an amendment to the sales tax rule on data processing services, 34 Texas Administrative Code Section 3.330, known as Rule 3.330. According to law firm alerts from Holland and Knight and Foley, the amendment would take marketplace and platform fees out of the definition of taxable data processing services.
The background goes back to 2025. Amendments to Rule 3.330 treated fees charged to sellers on marketplace platforms as taxable data processing. Business groups, including the Texas Taxpayers and Research Association, objected that the change expanded the tax without legal authority. The Comptroller now calls the result a hidden double tax.
The Fees Covered
According to the Comptroller's office, as summarized by Holland and Knight, the change would reach fees tied to sellers on online marketplaces, prepared food and grocery delivery through apps, short term lodging, ride hailing and other transportation, vehicle rental or sharing, pet care, and household and errand services. For hospitality owners, two items stand out: prepared food delivery and short term lodging. Restaurants that sell through delivery apps and hotels or rental operators that list on booking platforms should both pay attention.
One caution. The Comptroller's summary refers to prepared food delivery through apps. It does not use the word "restaurant." Reading it to cover restaurant orders on delivery platforms is a reasonable inference, but it is an inference until the proposed text is published.
What Has Not Happened Yet
This is the part owners need to hear twice. The order directs a proposal. It does not amend the rule. The proposed amendment must be filed with the Texas Secretary of State and published in the Texas Register, followed by a 30 day public comment period. As of this writing we have not seen a publication date, a comment deadline, or an effective date. The current rule stays in effect until an amendment is formally adopted.
Nothing we reviewed says whether the change will apply to past periods or whether anyone can get a refund. Holland and Knight suggests businesses evaluate possible refund opportunities and consider commenting on whether relief should be retroactive. Foley advises talking with a tax advisor before taking any refund position. We agree. Do not stop collecting or remitting tax based on a press release.
What Operators Should Do Now
First, keep filing under the current rule. Until the amendment is adopted, your collection and reporting duties stay the same.
Second, find out who is charging and who is remitting. On some platforms the app handles the tax on its fees. On others, the restaurant is expected to account for it. Pull a few months of statements and read the line items. If you cannot tell, ask the platform in writing.
Third, organize your records. If refunds become available, the owners with clean statements, invoices, and tax returns will move first. Keep every platform statement and every sales tax filing together, by period.
Fourth, review your platform agreements. Look for clauses that say who bears taxes on fees, whether the platform can pass through new taxes, and what happens when tax law changes. Many standard form agreements let the platform adjust charges on notice. If the rule changes in your favor, you want a contract that passes the benefit to you and does not let the platform keep it.
Fifth, watch for the proposal and consider commenting. The comment period is your one chance to tell the Comptroller how the fee tax lands on a real restaurant or hotel. A short, specific comment, with numbers, carries more weight than a general complaint.
Sixth, build the issue into deals and leases. If you are buying or selling a restaurant, a possible refund claim is an asset that should be addressed in the purchase agreement. Say who gets it. If you are a landlord or a tenant with percentage rent tied to gross sales, check how platform fees and sales tax are treated in the definition. A rule change can shift the math.
What This Does Not Do
The order addresses only marketplace and platform fees. It does not change the Comptroller's positions on other data processing issues, such as software as a service or cloud computing. It also does not change the sales tax your guests pay on the meal itself, or the mixed beverage taxes that bars already collect. And it does not change federal rules or the tax treatment of tips.
The Bottom Line
A rule change like this can put real money back into a restaurant's pocket, but only if owners are ready when it lands. Stay compliant today, tighten your records, read your platform contracts, and be ready to speak up when the proposal is published. Warren Kalyan works with restaurant, bar, and hotel operators on the contracts, deals, and regulatory details that sit behind the daily numbers.
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General information only, not legal advice for your specific situation.