Billion Dollar Sellers
Billion Dollar Sellers
Kevin King
States taxing sellers on marketplace fees (hidden on Amazon payouts)
19 minutes Posted Aug 31, 2026 at 2:54 pm.
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Date: August 31st, 2026
Summary: Kevin King unpacks the Texas rule change that quietly made marketplace fees taxable for Texas-based sellers, what it costs, and the narrow window sellers have to push back on it. He also runs through the September e-commerce conference calendar, Amazon’s latest quarter, MCF with Prime taking the Prime badge off Amazon and onto your own site, and the market that has sprung up around buying tariff refund claims for cash today.
 
Key Points Discussed:
 
Texas rewrote Rule 3.330 so that marketplace storage of your listings, records and analytics counts as a taxable data processing service, effective October 1, 2025
The math: 80% of your fee is taxable at up to 8.25%, roughly 6.6% on every fee — about $9,900 a year on $1M in sales, about $49,500 at $5M
Why critics call it a double tax: Texas collects on $115 of activity from a $100 sale with a $15 commission
The charge follows the seller’s registered address rather than the buyer’s, so a Dallas seller pays it and a Denver competitor selling to the same Houston buyer does not
Three reasons the rule stands on shaky ground: a 2012 position revoked quietly in 2020, an Internet Tax Freedom Act discrimination argument, and a new Fifteenth Court of Appeals signalling independence from Third Court precedent
Connected Commerce Council polling of 400 likely Texas GOP primary voters — 71% opposed once told it raises consumer prices, 63% less likely to back a candidate who supports it
What to do this week: pull three fee invoices, check the address your marketplaces hold, ask your CPA what else is in scope, and build 6.6% into 2027 pricing
Amazon’s quarter — $200.6 billion in net sales up 20%, operating income up 43% to $27.5 billion, trailing free cash flow negative at $7.6 billion, and AWS up 37%
The three September events Kevin is attending: Funnel Hacking Live 2026, UNBOUND, and AI Mafia
MCF with Prime puts the Prime badge and delivery speed on your own site with no checkout change, which is what separates it from Buy with Prime
The MCF math: $7.34 for a small standard unit non-peak, peak rates landing October 15, and roughly a 15% conversion lift needed to break even against a cheaper 3PL
Sellers cashing out tariff refund claims early — Academy Sports, GoPro and The Children’s Place — and why pre-ruling sellers took 20 cents on the dollar while holdouts collect in full
Third Person, the BDSN software tool of the day, matching brands to 3PLs through an AI screen of hundreds of providers
 
Links Mentioned:
 
Market Masters 4 replays (takeaways, workshops and SMART contest)
BDSS Market Masters 4
Funnel Hacking Live 2026 — “Encore: The A.I. Era”
UNBOUND, HubSpot’s rebranded INBOUND
AI Mafia, the referral-only Tampa retreat
Connected Commerce Council — contact Kristin Rae about the Austin meeting
Third Person, the free 3PL matching platform
Stack Influence (10% off by signing up this month)
Blueland micro-influencer case study with Stack Influence
 
Hot Picks:
 
Brands are turning to TikTok Shop to grow on Amazon
Levanta raises $22m series B investment as they keep expanding
Walmart says Sparky AI users spend 40% more than the average shopper
Amazon is expanding drone delivery 6-fold this year
How to check if your customers came from Google or Meta
USPS raising rates 6% from mid October to mid January
 
Stump Bezos Answer: 15% of your Facebook feed comes from your friends, family and followers.
 
Parting Shot: “If I had asked people what they wanted, they would have said faster horses.” — Henry Ford
 
Find us at BillionDollarSellers.com
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