STATE:

Why NFIB

Take Action

Get Support

Stay Informed

Podcast Podcast

Careers Careers

Join Now

Home / News /

NFIB Urges Lawmakers Not to Change Sales Tax Collections

April 19, 2022 Last Edit: June 5, 2025

Proposed changes would create confusion and additional costs and lead to higher prices for consumers.

NFIB Urges Lawmakers Not to Change Sales Tax Collections

NFIB State Director Annie Spilman will go before the Texas House Ways and Means Committee on Thursday to speak out against potential legislation that would change how and where sales taxes are collected across the state. “Currently, if a customer places an order from your business, you know the sales tax charged to the customer will be 8.25 cents on the dollar regardless of where they live. Some members of the Texas Legislature want to change that to something called ‘destination sourcing,’ which bases the sales tax on where the customer is located, not the business. “Supporters say destination sourcing would help local governments,” Spilman said. “They don’t think local governments benefit from taxes collected and remitted by the businesses in their jurisdiction, but by the customers who buy the product. Current system is working The business community argues that these cities and counties have a mutually beneficial relationship and it’s working. “The primary reason I am against it is because my city and so many others have done an excellent job of creating a pro-small business community,” said Sunni Petty, owner of Petty Tile, an NFIB member business in Round Rock. “It has been done with much intention by the mayor, city manager, city council, and staff, and the city deserves to reap the rewards of creating such a vibrant community to work, live and play! “If you strip away origin sourcing,” Petty said, “you strip away incentives for programs like these that carried hundreds of small businesses through the pandemic. It also reduces the incentive for people to shop local; their tax dollars are going to their place of origin regardless of where/who they purchase from.” Additional costs for small businesses Spilman said, “Changing the rules would create a lot of confusion and additional costs for businesses,” she said. “It would saddle businesses with an additional administrative burden and create an additional expense because of having to collect and remit sales taxes to multiple jurisdictions — over 1,600 in Texas alone! “Small businesses already are dealing with a labor shortage, higher fuel prices, supply chain disruptions, and soaring inflation,” she said. “Switching from origin sourcing to destination sourcing would only make things worse and inevitably lead to even higher prices for consumers. “That’s why we’ll be asking the committee to keep sales tax collections the way they are and say no to destination sourcing.” The Texas Legislature isn’t in session, but the committee’s work will set the stage for next year’s legislative session, Spilman said.

Topics:

Taxes

State:

Texas

Get to know NFIB

NFIB is a member-driven organization advocating on behalf of small and independent businesses nationwide.

Learn More

May 22, 2026

Millionaire Tax, New Mandates Mark Another Tough Session for State’s Small Businesses

Despite setbacks, NFIB defeated 90% of bills most harmful to small businesses

May 20, 2026

Post-Primary Comment on the Defeat of Measure 120

Voters send clear message: State government should live within its means

Man in a dark suit and blue polka-dot tie speaks during a live C-SPAN Washington Journal interview, with a cityscape backdrop visible behind him.

May 20, 2026

NFIB on C-SPAN: How Small Businesses are Managing Economic Pressures

A discussion on C-SPAN featuring an NFIB expert covers the current state of the small business economy and the top issues that are impacting Main Street.

Six professionals sit around a conference table reviewing documents in a modern meeting room.

May 19, 2026

NFIB Hosts Small Business Roundtables in Midland & Odessa

Attendees in Odessa heard from State Rep. Brooks Landgraf.

NFIB Urges Lawmakers Not to Change Sales Tax Collections

Related Articles