Paying Seller's Fees on state sales taxes collected by eBay.
Sure this topic has been covered many time before.
Why do the weasels at eBay charge a seller's fee on state sales tax paid by the buyer?
Other than being weasels, is there any rational reason eBay does this?
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22 comments
iamalwaysright
·3 years agoHey, I have a question that I know has already been answered here in the other posts I saw. I’m going to ask anyway and take up space.
mam98031
·3 years agoI'm really not a fan of calling people or companies names. Because you OPINION differs from them doesn't give you free license to call them names. We all can do better than that.
With that said, I agree that Ebay should not charge us FVF on the sales tax as they are the only site that does this that I'm aware of. With that said, your buyers would have to be paying a whole lot of sales taxes for it to register as a large expense. On a sale of $10 with buyer paying $1.25 in sales tax, your FVF for the sales tax is somewhere around 16 cents.
I know lots of seller say this and I just don't get it. Ebay is the ONLY site that charges their FULL fee on the entire price paid by the buyer. I'd understand it if it were like PayPal did, their fee, which for the money processing was 2.9% for most of us. But Ebay doesn't do that.
They changed their fee structure to the Simplified Fee so that there is only one fee that is charged on the entire amount that the buyer pays. So currently most sellers pay 12.9%. We are all use to paying 2.9% on the sales tax portion, but Ebay collects an extra 10% on taxes that was never done before and NO other site does.
All Marketplaces have the same responsibility to the states with MFLs [Marketplace Facilitator Laws] as Ebay does, but Ebay is the only site that structures their fees like this and it simply is not necessary or warranted.
First states would never get rid of the MFLs in order to go after individual sellers for sales taxes owed to their respective states. Second, most of us would not even meet their minimum thresholds for collecting and remitting sales tax for their states. So most of us would never even owe sales tax to most states, which is exactly why they created the MFLs.
Besides the cost of processing the sales taxes that should fall on the shoulders of sellers but the states that are requiring Ebay to collect and remit it. And let us keep in mind that for the couple of years BEFORE most of us went into MP Ebay did NOT charge us the entire FVF on sales tax. They ONLY did that AFTER we all went into MP.
But back to the states, it is the states that should compensate the marketplaces for collecting and remitting and they do.
chris13
·3 years agoI'm wondering if THIS is where the ChatGPT reply would be useful. Seriously.
It's a topic that rubs everyone the wrong way when they think about fees applied to totals that include a tax. It rubbed me the wrong way at one point too until I worked through it. It just isnt inherently intuitive to see the value and it gives off the 'vibe' of double dipping. /shrug.
chapeau-noir
·3 years agoYou don't need ChatGPT, just a macro which can be dropped into every one of these threads explaining the situation, and no more need be said.
maxine*j
·3 years agoNo more needs to be said, but the OPs will continue to argue and throw around their allegations of eBay's corruption and theft and on and on over the matter.
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chapeau-noir
·3 years agoAnd each one of those threads can have the macro dropped into it as the second post and that's the end of it. It would save a lot of people repeating themselves (and each other) over and over and over. Some situations there's just no room for discussion.
maxine*j
·3 years agoDoes the macro also close the thread to further replies?
We know that giving a full reply, with citations and links to policy, to which there should be no room for discussion, has never stopped an OP yet from carrying on with objections. Nor has it ever stopped those who agree with OP from chiming in with their own protestations and, sometimes, bad advice / info.
But if it's macro-and-closed, that would work for me.
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chapeau-noir
·3 years agoI'm thinking of it more just saving some work - sure people will continue to object, I don't like the high FVFs on it myself, but at least a lot of the legwork would be done.
mam98031
·3 years agoI see it as Ebay double dipping. They are paid by the states for processing sales tax. Neither Etsy or Ebay charge their FVFs on sales tax.
It doesn't save most of us any work at all. Most small and casual sellers would never have to collect and remit taxes for all the states it is appropriate for even if Ebay weren't doing it. We simply would not qualify. Which is exactly why the states started creating MFLs.
ms.rodriguez*
·3 years agoThey have to process the sales tax and submit it to each county. Can you imagine keeping track of each sale and then submitting the sales tax to each county. Remember, there are 50 states but ONLY God knows how many counties. Each county can have a different tax rate. Can you imagine how long it will take you just to find out what the tax rate is for each county that the buyer lives. But first, you have to figure out which county the buyer lives in. You don't get that information when they buy. Frankly, paying the sales tax for all purchases is one place where ebay actually earns their money.
soh.maryl
·3 years agoFrankly, handling payment of the state sales tax for all purchases is one place where ebay actually earns their money.
frommichel
·3 years agoHey now! I love weasels - they are adorable furry critters with crazy amounts of positive energy. Let's not confuse them with human-type folks doing things we don't like...
maxine*j
·3 years ago@frommichel
You will love this video of a tiny baby stoat*:
https://www.youtube.com/watch?v=2HFSaxIsJCE&ab_channel=TheDodo
*A stoat is pretty much the same as a weasel, and both are cousins of the ferret, for those who don't know their mustelids.
deltilogical
·3 years agoFunny - I think weasels are vicious little varmits that will kill every chicken in the henhouse and not eat a single one.
dbfolks166mt
·3 years agoFunny - I think weasels are vicious little varmits that will kill every chicken in the henhouse and not eat a single one.
So what to you call a politician? No offense to any lawyers on this site.
maxine*j
·3 years agoYep, as in most thing, it is all a matter of perspective. 😄
One of my favorite cartoons (which I'm sorry I didn't save) was of the lobsters in the kitchen of The Titanic shouting, "WE'RE SAVED!" as the ship sank.
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monroe67
·3 years agoI have tried to find something -- anything -- that spells out that eBay, as a Marketplace Facilitator, is allowed to or entitled to charge a fee to its users for doing what the Marketplace Facilitation laws require eBay to do.
Somebody today posted a quote from a publication from the California Franchise Tax Board and tried to "prove" eBay is wrong to charge a fee to their sellers -- something about wholesalers and retailers and yada yada.
I can't find anything from any of the few states I have looked into. Doesn't mean there are no rules or laws or regulations that allow eBay to charge fees. Just means I haven't found anything yet from my admittedly brief google searches.
Wonder if the South Dakota v Wayfair decision itself says anything about it. Knowing that all decisions of the US Supreme Court are published, and it was close to five years ago, I might look into that. It should be easy to find that decision online.
Until then, I choose to (try to) sell things on eBay. And I choose to abide by the rules and regs and policies and procedures of eBay.
dbfolks166mt
·3 years agoI have tried to find something -- anything -- that spells out that eBay, as a Marketplace Facilitator, is allowed to or entitled to charge a fee to its users for doing what the Marketplace Facilitation laws require eBay to do.
Somebody today posted a quote from a publication from the California Franchise Tax Board and tried to "prove" eBay is wrong to charge a fee to their sellers -- something about wholesalers and retailers and yada yada.
I can't find anything from any of the few states I have looked into. Doesn't mean there are no rules or laws or regulations that allow eBay to charge fees. Just means I haven't found anything yet from my admittedly brief google searches.
Wonder if the South Dakota v Wayfair decision itself says anything about it. Knowing that all decisions of the US Supreme Court are published, and it was close to five years ago, I might look into that. It should be easy to find that decision online.
Until then, I choose to (try to) sell things on eBay. And I choose to abide by the rules and regs and policies and procedures of eBay.
This is one of those instances where businesses, or individuals, can legally operate under the premises that if there is not law that says you specifically CANNOT do it then assume you can. It is the underpinning of the legal process and the only way it changes is if an action is challenged and either a law is passed or a court issues a ruling affirming or overturning the law.
The Wayfair vs South Dakota ruling did not establish a law but it effectively said that a seller did not have to have a physical presence in a state for the state to be able to collect sales tax on items sold within that state. Even after the ruling each of the individual states had to pass laws in order to start collecting sales tax.
maxine*j
·3 years agoYou are so right.
Here's another current thread:
https://community.ebay.com/t5/Selling/Final-value-fees-on-sales-tax-Are-you-kidding/m-p/33678191#M2193731
and here are hundreds more threads on this topic:
https://community.ebay.com/t5/forums/searchpage/tab/message?advanced=false&allow_punctuation=false&q=fees%20on%20sales%20tax
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soh.maryl
·3 years agoDo you really want to be responsible for collecting and remitting state sales tax for the approximately 46 states that have a state sales tax?
Oh, wait, within quite a few of the states, there are counties, municipalities, parishes etc where there is a particular sales tax for that jurisdiction also. So you really want to keep track of all those and remit appropriately? Wow! You are certainly braver than most of us!
dbfolks166mt
·3 years agoO joy the same question twice in one day and the same answer.
I have always considered the eBay FVF's on sales tax to be the best accounting bargain around. If you sell a $100 item to a buyer in a state with 8% sales tax the FVF on the $8.00 in sales tax amounts to 13.25% * $8.00 or $1.08 if you are promoting at 2% that adds another $.16 so the total FVF on the sales tax is $1.24.
For that $1.24 eBay keeps track of the 10,000 various state, county, city, parish, municipality..... sales tax rates and laws and applies and collects the proper sales tax from the buyer. They then remit those collected funds to the 45 states with sales tax laws on whatever periodic basis is required. There is NO WAY I want to take on that burden as a seller for $1.24 out of a $100 sale. "
stainlessenginecovers
·3 years agoEbay has to pay a company (or do it themselves) to keep track of the 45 states taxes were collected for, and then file 4x a year remitting report and payment with upwards of 36000 different county percentages required (example, California has 1800 different tax rated districts that have to be kept track of and then inputted into that 1 report, 4x a year)
Although a requirement due to the USSC ruling; it is still a cost and this site has the right to pass that cost onto it's customers. This is how they help pay for that. Is it much less than the 13% they collect? Not our business. Just like egg producers raised the price of eggs and then made a 725% increase in profits since Mid 2022.
Just like Insurances, Groceries, Gas, Utilities, Shipping Co's, Dept Stores etc. have the right (and they ALL do it) to PASS ON additional costs onto their customers.