Effective April 2, 2025, Texas updated Rule §3.330 which expands the definition of “data processing service” which represents the computerized entry, retrieval, search, compilation, manipulation, or storage of data or information. The definitional change largely represents a codification of less formally published rules and requirements.
In addition, effective October 1, 2025, marketplace provider services may be included in taxable data processing services when they involve the computerized entry, retrieval, search, compilation, manipulation, or storage of data or information provided by the purchaser or the purchaser’s designee.
Since data processing services in Texas are taxable based on 80% of the sales price, knowing what does and does not constitute data processing is critical to accurate taxation.
For more information on the new rule click here.
