I was considering purchasing an item from a seller on Ebay. I am concerned that Ebay or the seller on Ebay is allowed to charge tax on the shipping cost. So the item plus the shipping cost total then the tax is charged after that sum instead of tax charged on the item then the shipping costs added later. In the way it seems to be processed, Ebay or the seller gets a bit more money because the tax is charged to both the item and the shipping costs. Maybe this is Ebay's policy but I feel it is unreasonable for tax to be assessed to the shipping charges.
I can post an image of the item I wanted to purchase.
The item itself cost $14.98
The shipping charge stated $11.05
When I placed the item in my cart and went to the checkout,
the tax was assessed at $2.15
So if you take $2.15 / $14.98 you get about 14.3 % tax which I feel is unreasonable for my area
where the tax is like about 8.5%
Now if you take the total of $14.98 + shipping of $11.05 the sum is $26.03
now $2.15 / $26.03 you get tax of about 8.259% which is close to what the
tax rate is in my area.
So it would be nice to investigate if this is proper to assess a tax for the total of the item and its shipping costs. OR if the proper way is the assess the tax on the item and then add the shipping costs afterward.
Out of principal, I am not going to purchase this item from Ebay because I believe they are applying and adding the tax assessed incorrectly and should not include taxing the shipping costs if that is what they are doing....unless the tax really is 14%.
Addendum: Also, when I changed the shipping method and charges, the tax seems to change which means
that Ebay is assessing tax on the shipping costs as well as the item.
Thank you.
EastLaneAve • Volunteer Community Mentor
