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SB 1058

Relating to the exclusion of certain securities transaction payments from the total revenue of a taxable entity that is a registered securities market operator.

89th Legislature (2025) Introduced by César Blanco and 4 co-sponsors

Texas law now excludes pass-through securities transaction payments from taxable revenue for registered market operators, reducing their franchise tax obligations effective January 1, 2026.

Effective on 1/1/26
#financial--general(i0365) #mortgagebrokers&bankers(s0098) #taxation--franchise(i0807)
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WeVote Research Nonpartisan
Bill Summary · SB 1058

Legislative bill overview

SB 1058 exempts registered securities market operators (like stock exchanges) from counting certain securities transaction payments as taxable revenue under Texas tax law. The bill specifically excludes pass-through payments that market operators collect and remit to other parties from their total taxable revenue calculation. This effectively reduces the tax base for entities operating securities markets in Texas.

Why is this important

Securities market operators currently pay franchise taxes on all revenue they collect, including payments they immediately pass through to third parties without retaining. This creates a tax on intermediary transactions. The exemption could reduce operational costs for market infrastructure in Texas, potentially making the state more competitive for hosting financial market operations, though it also represents foregone state tax revenue.

Potential points of contention

  • Revenue impact: The state loses tax revenue from these pass-through payments, with the fiscal impact depending on transaction volumes at affected market operators
  • Fairness concerns: Other businesses cannot exclude pass-through payments from taxable revenue, raising questions about whether financial markets receive preferential tax treatment
  • Definition precision: "Registered securities market operators" and qualifying "transaction payments" require clear regulatory definition to prevent unintended loopholes or disputes over what qualifies for exclusion

Compiled from official sources — confirm details with the bill’s official record.

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