eBay's Management Payment isn't what you thought it was!!

[warbunny]

Heyooo, 

It's Christmas 2020 and I just figured out eBay's horrible new management payment system that it forced on sellers.

It was advertised as primarily being better than the old system which included PayPal fees and etc.  eBay's marketing made it seem that most sellers would sell their items and pay a basic final value fee of 12.35% plus a transaction fee of $.30.   THAT'S NOT THE CASE.

Seller's are actually paying a final value fee of 12.35% on the sale price PLUS the state taxes collected and a transaction fee of $.30.

Yeah, I noticed something wasn't right when I first switched over, but now it's December and things are clearly off. 

Example, I sold several of the same item in the same category and from the same listing to three different buyers, but several different fees were collected from the same amount!!

Example: The item in the same listing and category sold for $13.74

Buyer 1: fees came to $2.07

Buyer 2: fees came to $2.10

Buyer 3: fees came to $2.13

Buyer 4: fees came to $2.15

Taxes are collected by eBay and SHOULD be irrelevant, if there's a base percentage + $.30 per transaction. How can the same amount result in 4 different fees being collected; all of which are well over the advertised fee amount.

None of this makes sense. Examples of this new fee on eBay's Help Menu doesn't make things any clearer, it makes it seem as though the fees are based off just the sale price.

Turns out eBay's double dipping!!

eBay's final value fee is based off the sale price + the buyer's state tax amount, not just the sale price. That's why the fees are varied and don't make sense on initial review.

eBay's customer support from the "Management Payment team" claim that eBay has to charge seller's like this due to the Supreme court decision regarding South Dakota....  It (supposedly) forces eBay to have a fee based system based off of the transaction cost PLUS the sales tax that eBay collects, instead of just being off the transaction cost and the sales tax being collected not being included in the fees eBay charges sellers. This was because of the Supreme Court and not because of Corporate Greed, conflating a complex system.

eBay can easily charge seller's a final value fee purely based on the transaction price and collect and remit states sales tax collected on that transaction.  eBay fees including taxes does not seem to be a Supreme Court requirement, but a way for eBay to collect/inflate a higher fee (that was not blatantly advertised to sellers).

Example: Sale Price = $50, State Taxes =$5, Final Value Fee = $50 x 12.35% = $6.18 + $.30 = $6.48    A $50 sale has a fee of $6.48, based on the sale price.

Actual Fee system: Sale Price = $50, State Taxes = $5, Final Value Fee = $55 x 12.35% = $6.79 + $.30 = $7.09, A $50 sale has a fee of $7.09 based on the sale price and the buyer's state taxes collected on behalf of the seller.

According to eBay they have to charge the $7.09 and not the $6.48, because the Supreme Court forces eBays fee system to be like this and not corporate greed.

[veronicabooksandart]

The latest canard floated is they need the money to pay their accounting department, sideswiped over reporting sales tax across 50 states.
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If they've propped this boat up for sale, they better sell it quick.

[comics-scifi-collectibles]

@warbunny 

Not saying I am a fan of the final value fees being charged on the sales tax but it was expected since paypal also charged their 2.9% fee on the sales tax.  

It is normal for a funds processor to charge their fees on the total funds that they process. 

[buyselljack2016]

@warbunny 

eBay is charging a fee on the total amount paid by the buyer.

PP charged fees on the total amount paid by the buyer.

The eBay 12.35% on the sales tax amounts to little.  (12.35% of  10% (often lower))

I ran the #'s on 50 sales after the simplified fees went into effect.

I found my fees to be about a break even when compared to the previous eBay + PP fees.

What I see is a 6 % sales tax rate is just about a match on fees. If tax rate is higher the fees are a bit more. Below 6% fees a little less.

I have added a few pennies to my listings here, and there, and a few $$ where the market will bear, to equal things out.

[buyselljack2016]

 Pre MP  $50 sale with $5 tax. That's a 10% rate (many are lower)

I paid ebay        $5

I paid PP             $1.90

                              $6.90

In  MP  I pay     $7.09       a  19cent difference. (increase)    

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If a pre MP sale was   a no sales tax  $50 sale

$50 sale at 6% would be 1 cent difference (increase)  2 cents per $100  My business model can handle the hit.

I paid ebay   $5

I paid PP        $1.75

                         $6.75

In MP  I pay  $6.48          a 27 cent difference. (decrease)

About 10%  have no sales tax  

Many delivers go to buyers with a tax rate lower than 10%   

A $50 sale to 6% sales tax would be a  1 cent increase.  2 cents per $100  My business model can handle that.

[buyselljack2016]

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@buyselljack2016 wrote:

 Pre MP  $50 sale with $5 tax. That's a 10% rate (many are lower)

I paid ebay        $5

I paid PP             $1.90

                              $6.90

In  MP  I pay     $7.09       a  19cent difference. (increase)    

---------------------------------------------------------

If a pre MP sale was   a no sales tax  $50 sale

$50 sale at 6% would be 1 cent difference (increase)  2 cents per $100  My business model can handle the hit.  see below

I paid ebay   $5

I paid PP        $1.75

                         $6.75

In MP  I pay  $6.48          a 27 cent difference. (decrease)

About 10%  have no sales tax  

Many delivers go to buyers with a tax rate lower than 10%   

A $50 sale to 6% sales tax would be a  1 cent increase.  2 cents per $100  My business model can handle that.

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[psloter143ul]

On top of that, if you as a seller give a buyer a partial refund eBay doesn't adjust the fees they collect from seller.  The only way to get the fee adjusted is to cancel the whole transaction and then invoice the buyer.  for the adjusted amount.  A total unneccesary action for seller and buyer when eBay is managing the whole payment process and has complete visibility.

Come on eBay.  Do the right thing for the sellers!  If you are going to manage the whole payment process, do something that is fair and makes it easier for sellers and buyers!

[kensgiftshop]

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@psloter143ul wrote:

On top of that, if you as a seller give a buyer a partial refund eBay doesn't adjust the fees they collect from seller.  The only way to get the fee adjusted is to cancel the whole transaction and then invoice the buyer.  for the adjusted amount.  A total unneccesary action for seller and buyer when eBay is managing the whole payment process and has complete visibility.

Come on eBay.  Do the right thing for the sellers!  If you are going to manage the whole payment process, do something that is fair and makes it easier for sellers and buyers!

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Ebay never has refunded fee's on partial refunds.