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Final Value Fees on Shipping and Taxes Inherently Unfair
I've read many comments on Final Value Fees placed on orders which are to not the item itself, but to sales tax and shipping in total. I've read the complaints. I've read the explanations. The unfair truth is in the math itself. I do large orders. I do small orders. The following example is on a $6 item which included free shipping and $.41 tax:
What you earned
Order total
$6.41
eBay collected from buyer
Sales tax
-$0.41
Selling costs
Transaction fees
-$1.47
Shipping label
-$4.81
Order earnings
-$0.28
On this particular order you see that I made $0.28. Ebay made $1.47. Absurd right? Why? Because Ebay made more money off the sales and shipping in combination with my item than I did on just the real value of the item. Totally unfair. I know it's their platform. And I appreciate the opportunity to sell on this great plafform, But sellers are being taken advantage of.
28 comments
kh-sireesha
·8 months agoHi everyone,
Due to the age of this thread, it has been closed to further replies. Please feel free to start a new thread if you wish to continue to discuss this topic.
Thank you for understanding.
ccomic
·8 months agoI can see how they need to apply their fee to the price+shipping, so people don't list items for $1 and $99 shipping. But to apply their fee to the sales tax makes no sense. Its not part of the sale and there is no way for the buyer to manipulate or benefit from the sales tax.
albertabrightalberta
·8 months agoThis thread is almost 2.5 years old.
johnrj1226
·1 year agobabyers88
·1 year agoyou can thank previous sellers for these fee's
people thought and (some) still do think they are being slick and listing something for $5 and charging $60 shipping for something that cost's $10 to ship.
they did get away with circumventing the fee's for a period of time, but took action and now the fee's apply to the entire sale for all.
so your frustration should be pointed at unscrupulous sellers, when I see a listing like noted above I kinda giggle a little bit, do buyers fall for the bait and switch? sure they do ooh look i found one listed for $5 but then at checkout bam monster shipping charge!
bamacollabs
·1 year agoI can't tell you how much I agree with you and what everybody says is it's their platform they get to choose or how else do you expect eBay to make profits, blah, blah, blah, blah blah very simple the way they did pre-covid they're making from the last 20 years or 30 years. They're making hell of a lot of money at the percentages they were charging. Then all of a sudden we have a pandemic and afterwards now we're charged double what we were charged. Actually, actually I'm being charged more than double than what I was prior to covid. I one would think that if a company's profits and total sales went up radically higher than the expectation was prior to a pandemic that at least prices would fees would stay the same. But I would even think that you might want to give back to your sellers a little bit. But no no, that's fine. Let's just keep it even and I know not even that we're going to increase your 17% fee to a whopping 38% fee
Now other platforms have increased their fees to keep in line with eBay. But even before that, just the amount of customers that you have access to using eBay would be unfair business practices to price you out of it. Not only that, but it's also predatory. And that's before you add in the fact that all other platforms are following their suit but just based off of competition alone and access to customers. It's under antitrust. But you add in The fact that other platforms follow their lead and increase their pricing means not only are you having the company being unfair in their business practices, they are in turn impacting all other companies in the same industry to increase their pricing. So they are making an industry as a whole predatory.
Add to this the fact they snuck in promoted items into the mix and not only into the mix but inherently wrong and the way they apply the fee based off of. If anyone clicks on your promoted item and buys that product anywhere on eBay, you are going to be charged the promoted fee because of the fine print, it doesn't say that if someone clicks on your item and buys it from that very link you get charged. It says if anyone one clicks on your item is charged by click is what it says.
So if anybody who clicked on your advertisement and bought that same item somewhere else or anywhere on eBay, you are going to be charged that fee no matter what.
And I'm going to have bots and paid Shields and people who weren't charged these percentages in certain industries and categories on eBay come to the leaping to the fence of eBay but and fine do that. But you're wrong mathematically and ethically and legally it just takes someone to be able to bring a large enough suit which they have lost but it doesn't matter because they didn't have to change the fact they just settled out of court so that way they don't have to change. And I guarantee you 75 to 90% of sellers don't even know that that it's been. They were so scared of it being ruled illegal because they know that it is that they settled out of court for millions of dollars in class. Action lawsuits stating these exact same thing. But they're going to still out of court every time because of how much money they're making. Again, I don't care about making profits if it's done legally and ethically hell ethically schmethically right now I just wish they would do it legally start somewhere
hljohns
·2 years agoI agree with you, it doesn't seem quite right. I don't mind paying the final value on the item, but I hate paying it on the item + postage + tax. If I sell a $2 item and charge $1 postage, eBay charges a fee on $3 , not just the $2.00 item.
dave8237
·2 years agoIf you look more carefully...it looks like it 'COST' you 28 cents so you paid to have the person get your item.
It shows -$0.28
AND-eBay has found a way to charge a fee for postage which was never charged to the buyer? If we dig further-what more can we find? This has to be a GROUP effort-so eBay is forced to answer for their Very UNFAIR charges. eBay no longer has a MONOPOLY-there are many other venues to sell your products-and I am hearing a lot of BUYERS and SELLER are getting disgusted with how this company is run. Check out my eBay <dave8237> next week. I have probably been 'CANCELLED' - lol. Won't make a difference in MY life-but many sellers COUNT on this site to make a living. A LOT of people WANT to work-rather than get hand-outs. We should be supportive - rather than SELFISH, and help the country grow and give sellers the opportunity to feel they are contributing to society. It's a slippery slope. Should the PUBLIC be aware of whether eBay pays taxes? I, for one, would like to see some numbers. Why isn't anyone asking?
dave8237
·2 years agoI was shocked to discover Final value charges included shipping (which most sellers DON'T make money on). THEN I discover, by mistake, that sellers are ALSO charged a final fee on what buyers paid for sales tax. Seems like it should be against the law. What is going on with eBay? EVERY TIME they 'improve' (HA-HA) the buying & selling experience...the SELLERS GET SCREWED! Don't they realize-if the sellers LEAVE...Their buyers have nothing to buy!?!? It should be fair to both sides. If sellers can leave negative or neutral feedback-the sellers should have the same option. It is hardly worth it anymore. And next year the limit for filing with the IRS is something like $500??? It used to be $24,000! WHAT IS GOING ON???
This was my last sale. which I only made $171 on.
soh.maryl
·2 years agoeBay posts information about how the FVF is charged so not sure why it's a surprise to any seller.
The fact that the FVF is charged on shipping as well as the item price has been shown since about 2008, so hardly a new charge. The fact that FVF is charged on state sales tax as well has been several years so should not be surprising.
So many people post here and feel that those fees should be against the law. Don't you imagine that eBay has a legal staff that has determined that it's legal?
naeem
·2 years agoThe buyer pays the tax. What was the item? Before you listed it you knew the final value fee was going to be 30 cents for the transaction and around 10% (10.8% here) of the $6 + $4.81 = $1.17
Actually it looks like you lost money.
$6.41 income and they back out the 41 cents tax because the buyer paid that. $6 - $1.47 fees - $4.81 shipping = NEGATIVE 28 cents.
What is the item? You may need to re-evaluate buy it now items and when if at all to offer free shipping.
This was a losing sale the day you listed it unfortunately...... "unless" the $6 was opening bid and you thought bidders would drive it up.
As far as fees go I'm troubled by a 17.5% final value fee I had to pay on the sale of an item. CRAZY too high.
naeem
·2 years agoTYPO >> and around 10% (10.8% here) of the $6 + $4.81 = $1.17
That should have been $6 - shipping (which turned out to be $4.81) = $1.17
Also you should weight and calculate shipping to the furthest zip code from your house. before listing it with free shipping
monroe67
·2 years ago". . . the final value fee was going to be 30 cents for the transaction and around 10% (10.8% here) . . . ."
Just curious: Where ("here") is eBay's final value fee only 10.8% ?
Your listings say you are located in South Carolina, in the United States.
Therefore, your sales are subject to eBay's fee schedule for sellers registered in the United States.
That Final Value Fee percentage (for most categories) was raised to 13.25% in February of this year, 2023.
soh.maryl
·2 years agoCan you show us the actual figures for the transaction for which you paid an FVF of 17.5%?
monroe67
·2 years agoOP posted: "I've read many comments on Final Value Fees . . . . I've read the complaints. I've read the explanations. The unfair truth is in the math itself. I do large orders. I do small orders. The following example is on a $6 item which included free shipping and $.41 tax:
What you earned
Order total
I don't usually copy so much of a post that I respond to but, in this case, I think it's necessary in order to try to convey the points I wish to make.
First of all, OP, you did not make $0.28 on this transaction.
See that little "minus" symbol in front of $0.28, your "order earnings"? It means a negative 28 cents.
OP, you OWE 28 cents to eBay.
The second point is -- in this particular sale, the absurdity lies in "free shipping" of an item that the OP actually had to pay $4.81 to (presumably) the United States Postal Service. Look at your numbers again.
Your buyer paid $6.41. We know that 41 cents will be sent to the buyer's state, as sales taxes. Subtotal is $6.00.
eBay's fees came to $1.47. $6.00 minus $1.47 = next subtotal of $4.53.
USPS needed $4.81 to deliver the item to your buyer. Subtotal of $4.53 minus $4.81 = negative $0.28.
Again: The OP owes 28 cents to eBay.
None of the above is eBay's fault. Nor is it the fault of the USPS. Math is not inherently unfair.
The way to fix situations like this in the future is not to list anything else with "free shipping." Free shipping does not exist.
soh.maryl
·2 years ago"The way to fix situations like this in the future is not to list anything else with free shipping."
And also not to list anything to sell as low a $6.00.
cribster6710
·8 months agoIf he would have charged for shipping, that would have drove up his final value fee as well and if he was honest and only charged close to the actual shipping cost, he wouldn't have made much more anyway. This system sounds like it wants people to charge more for shipping low priced items to try to break even. This sucks!
thriftiquetrader57
OP2 years agoHello,
Thanks for your response and not trying to be "snarky" as you stated in your reply to me, I never stated that this was the first time I had noticed the, what I believe unjustified fees attached to both shipping and federal taxes. This is however, the first time I have vented my displeasure with this policy on this forum board. I don't need to be told where the money goes in regards to state taxes. My post never complained about that. It is what it is, and I understand the states are entitled to their money. I find it interesting that you never addressed the issue of how a seller can sell an item and receive only 25 percent of the final sale revenue while eBay receives 75 percent? BTW, I notice that you are a very active responder to seller's issues and complaints and wonder, if you are not a seller, are you a moderator who responds on eBay's behalf? Not being "snarky" of course 🙂
soh.maryl
·2 years agoAs I mentioned, when a seller lists low-priced items and, in addition, offers free shipping, he should be able to see that he is shooting himself in the foot because there is almost nothing that anyone can ship anywhere via any courier for any less than $3. That's how the seller can receive so little. And, that 75 percent that you feel eBay receives, if you are referring to the shipping fee and the state sales tax, eBay DOES receive it, yes, but the shipping money goes to the courier and the sales tax goes -- well, you know where it goes.
This does not involve Federal taxes. The state sales tax is what the buyer pays based on his delivery address and the state sales tax is included in the total upon which eBay bases their FVF.
Actually, you have no idea whether or not I am a seller. eBayers can have several IDs and many do, maybe one for selling, one for buying and one for posting on the Boards.
No, I am not a moderator nor am I employed by eBay in any way. eBay employees, who very rarely post on the Boards, are very clearly identified as such.
cribster6710
·8 months agoBut ebay does receive a percentage of that shipping fee and taxes because there final value fee is based on the total transaction payout.
soh.maryl
·8 months agoYes, that's entirely correct and I am well aware of that, thank you.
soh.maryl
·2 years agoYour message is confusing to me, but will try to respond without being sounding snarky.
You have been an eBayer since 2012, so 11 years. Not sure how long you have been selling, but was this the first time you noticed the fees?
The FVF has been charged on shipping since, I believe, the late 90s, perhaps earlier.
The FVF on the state sales tax has been charged since about 2021, again maybe earlier.
It coincided with the Supreme Court ruling that allowed individual states to levy sales tax on internet sales. eBay collects those funds and remits them to the individual state treasuries. As the individual states enacted legislation enabling them to do so, eBay began collecting and remitting these funds. There are now, I think, about 47 states who are enrolled.
fab_finds4u
·2 years agoWherever you shop online or in person in a walk in retail store, when your purchase is rung up the store's credit card/payment processor charges the store a fee based on the total cost. This is how payment clearing houses work.
ADYEN Is the payment processor for eBay. They process the payment and they don't do it for free. eBay makes sure the money ends up in the right pockets and they don't do that for free.
You know how it is, everywhere you go somebody has their hand out.
thriftiquetrader57
OP2 years agoI just wanted to amend my previous post. Without shipping and tax the $6.41 order place the retail price of the item I was selling at $1.75 where Ebay's cut essentially became $1.47 while I received $0.28.
bonjourami
·2 years agoThat sounds about right for a $6 listing.What did you expect to make?
cribster6710
·8 months agoHow about 5 bucks? Seems fair to me.
soh.maryl
·2 years agoThe current fee schedule has been in place now for several years and is not kept a secret from sellers.
Most experienced sellers here agree that selling any item for less than $20, especially with F/S, is a losing game.
lakefor94
·2 years agoLow value items with Free Shipping will always be a struggle, margin wise.
Sellers are just going through the motions with that type of Item.