mam98031 • Volunteer Community Member • Buyer/Seller since 1999
@23nyfans wrote:unfortunately ebay takes every profit we try to make, always finding a way to take it from us and we keep selling on there platform, im in the same boat you are in just keep pushing forward.
Then you either aren't pricing your items right or you need to find different products to sell. Ebay is upfront about the fees they charge. It is up to the seller to consider all their costs and price their products accordingly and to allow a profit for the item.
Sellers that do listings that are extremely inexpensive items really depend on multiple purchases to earn any kind of profit. Selling one offs typically will on reap them pennies, if that.
Product sold for 1.75 plus .63 cents for shipping isn't going to make anyone rich.
1.75
.63
2.38 Total
.31 FVF @ 13%
.30 Per transaction fee
.63 Shipping
.10 Shipping supplies [just a guess]
1.34 Total
2.38 - 1.34 = 1.04
The above numbers are not exact as I do not have any knowledge of your actual expenses other than your FVFs and shipping fees. But I'm sure you get the idea.
@dbfolks166mt wrote:@mikesdavis wrote:Nonsense. Nice spin. Ebay itself say they charge a fee on tax and shipping because sellers tried to get around paying a fee by lowering the item cost and raising shipping. Read it in Ebay own words
It is a good thing to understand the history on this site. Fees on shipping started in 2011. Fees on sales tax started almost a decade later. We did not pay FVFs on taxes until each seller entered Managed Payments. Which happen for most sellers between the summer of 2020 and the end of 2021.
Actually it had nothing to do with a seller being moved into Managed Payments. The application of e-commerce sales tax was the result of the Supreme court ruling in South Dakota vs Wayfair in 2018 and that just said it was legal for states to charge tax on purchases made from out-of-state sellers even if the seller does not have a physical presence in the taxing state. It then took the individual states to pass their own separate laws governing the collection of those taxes. Missouri was the latest, and last, to do so beginning 1 January 2023. Prior to that buyers in Missouri were not paying sales tax on e-commerce purchases. The whole situation is rather complex to say the least.
https://www.pwc.com/us/en/services/tax/assets/pwc-salt-tax-insight-wayfair-5-years-later.pdf
You are confusing two completely different things. Fees on sales tax and fees on shipping. They are not one and the same. Nor did it start at the same time.
You may not agree with what I said, but that does not make me wrong. The statement was in part "charging Fees on tax" Ebay did NOT do that until they became the money processor AKA Manage Payments. Before Ebay was our Money Processor, PayPal was and PP charged the fees on sales tax. While Ebay did charge the buyer for the sales tax, they did NOT charge the FVF on sales tax. Not until PP was no longer our Money Processor and Ebay was.
So for Ebay to be charging the FVF on sales tax, it has everything to do with Ebay becoming our Money Processor.
You are confusing MFLs [Marketplace Facilitator Laws] with FVFs on sales tax. The implementation of those two things are separate events. The MONEY PROCESSOR has always been the one to charge their fee on the entire amount of money processed. PayPal was that until the time each seller was onboarding between the summer of 2020 and the end of 2021.
@traditonalproducts wrote:Your fees are tax deductible at the end of the year just as well are the shipping charges that claim "free shipping". Based on this your profit margins are adjusted at the end of the year meaning you spend less tax on what you earn.
Yes in part. Free Shipping does not reduce your taxes unless you are not pricing your products correctly.
When a seller offers Free Shipping, they should be including the cost of shipment in their calculations for costs on a product, then add profit and you have your selling price
So for example: A listing for $10 and $5 shipping = $15.00 X 13.25% = 1.99 + .30 per transaction fee.
A listing for $15 and free shipping is $15 X 13.25% = 1.99 + .30 per transaction fee.
No one gets real free shipping. It costs someone. The program should have been named Shipping Included, but this marketing program was not created by Ebay, it is just something they adopted long after other sites were doing it, so buyers were familiar with it as Free Shipping and Ebay just continued on with that name.
@ulfesharpe wrote:
@netteee0 wrote:maybe there's a good reason Ebay is charging a fee on taxes and shipping
No, there isn't.
For some reason when PayPal charged the fee no one was really complaining, but now that Ebay does, some get upset. Not sure why, but they do. All money processors charge the fee on the entire amount received.
While I completely disagree with how you said it because you apparently had the need to call the other member names, it could have been explained better to you.
ALL Money processors charge their fee on the TOTAL amount of money they receive / process. Ebay is no different. They are now the money processor.
Ebay also has what they call a Simplified fee. That fee includes their money processing fee and their FVF. Now for shipping it would equal the same Fees since Ebay charges a FVF on shipping.
However for taxes, until they onboarded sellers into MP, they never charged their FVF on sales tax. And before Ebay became our money processor PayPal was, so PP charged their fee on the total amount received to include sales tax.
So since Ebay never charged their FVF on sales tax pre MP, and now Ebay has a Simplified Fee [one fee for money processing and FVF], then we now do pay a FVF on sales tax.
I know, how dare they make money, it is only suppose to be the sellers that make money. They started this site to service the sellers, not to actually create a company to make a profit. [all sarcasm]
Have you compared Ebay pricing to other sites? You will find that Ebay is not the lowest price site, but they also aren't the most expensive.
The FVF in most categories has not changed for more than a couple of years.
@soh.maryl wrote:It might also be noted here that the fact that eBay is now required by law to collect state sales tax from buyers on their purchases is a relatively recent thing stemming from a Supreme Court ruling in about 2018 (?).
And that could be considered part of the reason that buyers are seeing state sales tax charges as a relatively recent thing plus sellers are seeing their FVF being charged in those instances as fairly new also.
I'm sorry I gave you the impression that I did not understand this. I must of wording things badly, sorry.
Just as a fact to consider. Other Marketplaces are under the same rules and laws as Ebay yet neither Etsy or Amazon charge their fees on sales tax. IDK about other similar sites, but these two do not.
